Alfs Feels Only 3000 Nbfcs May Seek Registration

The Association of Leasing & Financial Services Companies (ALFS) has estimated that only around 3000 non-banking finance companies (NBFCs) are likely to apply for registration. As per the register with the Registrar of Companies, the industry estimates there are over 40,000 NBFCs currently in operation. At present around 850 NBFCs are registered with the RBI.

Mahesh Thakkar, executive director of ALFS said, the process is likely to cause a major shake-out in the sector. Only companies seriously involved in the business will apply for registration, he said. RBI is accepting the application forms at 16 centres. ALFS has urged the RBI to be selective while granting fresh registration certificates. ALFS as well as industry officials had asked RBI to tighten the eligibility criteria. In meetings with RBI officials, members of ALFS and other organisations suggested the present net-owned funds limit of Rs 25 lakh is too low. Experts want the limit raised to Rs 50 lakh or even Rs 1 crore. Industry sources believe the number of NBFCs who apply for registration wont be over 3000-4000.

 

This should minimise the pressure on RBI, which needs to complete the registration process within two months. ALFS and industry officials want RBI to expedite the process and have requested that the deadline of July 8, 1997 not be extended.