The Reserve Bank of India (RBI) has proposed regulatory relief for smaller non-banking financial companies (NBFCs), exempting those with assets under Rs 1,000 crore and no public funds from mandatory registration with the central bank.

The RBI’s move will reduce the compliance burden for such NBFCs and ensure that they can operate efficiently without compromising systemic stability.

“Given their unique nature, a review of the regulations presently applicable to these NBFCs has been undertaken. Considering their significantly lower systemic-risk profile, it is proposed that such Type-I NBFCs with asset size not exceeding Rs 1,000 crore may be exempted from registration requirement with the Reserve Bank, subject to certain specified conditions,” said Governor Sanjay Malhotra while announcing the bi-monthly monetary policy.