HomeNewsBankingRBI introduces Scale Based Regulation (SBR) for NBFCs

RBI introduces Scale Based Regulation (SBR) for NBFCs

RBI introduces Scale Based Regulation (SBR) for NBFCs

The Reserve Bank of India is going to introduce the scale-based regulation (SBR) for non-banking finance companies (NBFCs) and it will come into effect from October 01, 2022.

  • RBI has divided NBFCs into four layers (or 4 scales) on the basis of size, activity, and perceived riskiness.
  1. NBFC – Base Layer (NBFC-BL),
  2. NBFC – Middle Layer (NBFC-ML),
  3. NBFC – Upper Layer (NBFC-UL)
  4. NBFC – Top Layer (NBFC-TL).
  • base layer – It is NBFCs with asset size up to Rs 1000 crore and includes NBFCs P2P and NBFC Account Aggregators.
  • middle layer – It will have an asset size of over Rs 1,000 crore and housing finance companies. will also include core investment companies, infrastructure finance companies.
  • Upper layer NBFCs – Is to be identified by the Reserve Bank as warranting enhanced regulatory requirement based on a set of parameters and scoring methodology as provided in the Appendix to this circular.
  • Top Layer – It will ideally remain empty. it will be used when there is a substantial increase in the potential systemic risk from specific NBFCs in the Upper Layer and Such NBFCs will be included to the Top Layer.


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