Reserve Bank of India (Non-Banking Financial Companies – Acquisition of Shareholding or Control) Directions, 2025

RBI/DOR/2025-26/340 DOR.HOL.REC.259/16.13.100/2025-26 November 28, 2025

Reserve Bank of India (Non-Banking Financial Companies – Acquisition of Shareholding or Control) Directions, 2025

Table of Contents Chapter I- Preliminary A. Short Title and Commencement. B. Applicability C. Definitions Chapter II: Acquisition of Shareholding or Control A. Acquisition of Shareholding or Control of NBFCs B. Application for prior Approval C. Requirement of prior Public Notice about Change in Control/ Management D. Investment from FATF non-compliant jurisdictions Chapter III- Repeal and Other Provisions A. Repeal and saving B. Application of other laws not barred C. Interpretations Annex I

In exercise of the powers conferred by Sections 45JA, 45K, 45L, 45M and 45MA of the Reserve Bank of India Act, 1934 (Act 2 of 1934), the Reserve Bank of India being satisfied that it is necessary and expedient in the public interest to do so, hereby issues the Directions hereinafter specified.

Chapter I- Preliminary

A. Short Title and Commencement.

1. These directions shall be called the Reserve Bank of India (Non-Banking Financial Companies- Acquisition of Shareholding or Control) Directions, 2025.

2. These directions shall become effective from the date of issue.

B. Applicability

3. (1) These Directions shall be applicable to the following Non-Banking Financial Companies (hereinafter collectively referred to as ‘NBFCs’ and individually as ‘an NBFC’), for all layers:

(i) The provisions given in Paragraph 6 to 13, except 6(3) and 6(4), shall apply to the following: (a) NBFC-D registered with the RBI under the provisions of the RBI Act, 1934; (b) NBFC-ICC registered with the RBI under the provisions of the RBI Act, 1934; (c) NBFC-Factor registered with the RBI under the provisions of the Factoring Regulation Act, 2011; (d) NBFC-MFI registered with the RBI under the provisions of the RBI Act, 1934; (e) NBFC-IFC registered with the RBI under the provisions of the RBI Act, 1934; (f) IDF-NBFC registered with the RBI under the provisions of the RBI Act, 1934; (g) HFC registered with the RBI under the provisions of the NHB Act, 1987; (h) CIC registered with the RBI under the provisions of the RBI Act, 1934; (i) NBFC-P2P registered with the RBI under the provisions of the RBI Act, 1934; (j) NBFC-AA registered with the RBI under the provisions of the RBI Act, 1934;

(ii) The provisions contained in Paragraph 6(3) shall be applicable to HFCs.

(iii) The provisions contained in Paragraph 6(4), 11, 12 and 13 shall be applicable to SPD registered with the RBI as NBFC under the provisions of the RBI Act, 1934;

(2) These Directions are not applicable for the following:

(i) MGC registered with RBI under the scheme of Registration of Mortgage Guarantee Companies;

(ii) NOFHC registered with the RBI as NBFC under the provisions of the RBI Act, 1934.

Note: The applicability under these Directions is in line with the regulatory structure for NBFCs as set out in Reserve Bank of India (Non-Banking Financial Companies – Registration, Exemptions and Framework for Scale Based Regulation) Directions, 2025.

C. Definitions

4. In these Directions, unless the context otherwise requires, the terms used shall bear the meanings assigned to them below, and their cognate expressions and variations shall be construed accordingly:

(1) ‘control’ shall have the same meaning as assigned to it under clause (e) of sub-regulation (1) of regulation 2 of Securities and Exchange Board of India (Substantial Acquisition of Shares and Takeovers) Regulations, 2011;

(2) ‘public deposit’ shall have the same meaning as contained in Reserve Bank of India (Non-Banking Financial Companies- Acceptance of Public Deposits) Directions, 2025;

(3) ‘relative’ shall have the meaning assigned to it under clause 77 of section 2 of the Companies Act, 2013;

5. All other expressions, unless defined herein, shall have the meanings assigned to them under the RBI Act, 1934, the Companies Act, 1956 or the Companies Act, 2013 (Act 18 of 2013).

Chapter II: Acquisition of Shareholding or Control

A. Acquisition of Shareholding or Control of NBFCs

6. An NBFC shall require prior written permission of the Reserve Bank for the following:

(1) Any takeover or acquisition of control of the NBFC, which may or may not result in change of management;

(2) Any change in the shareholding of the NBFC, including progressive increases over time, which would result in acquisition/ transfer of shareholding of 26 percent or more of the paid-up equity capital of the NBFC.

Provided that, prior approval would not be required in case of any shareholding going beyond 26 percent due to buyback of shares/reduction in capital where it has approval of a competent Court. However, the same is to be reported to the Reserve Bank / NHB not later than one month from its occurrence.

(3) any change in the shareholding of an HFC accepting / holding public deposits, including progressive increases over time, which would result in acquisition / transfer of shareholding of 10 per cent or more of the paid-up equity capital of the HFC by / to a foreign investor

Provided that, prior approval would not be required in case of any shareholding going beyond 10 per cent, as applicable, due to buyback of shares/ reduction in capital where it has approval of a competent Court. However, the same is to be reported to the NHB not later than one month from the date of its occurrence.

Further, provided that, in cases of acquisition or transfer of control of HFCs holding CoR valid for accepting public deposits, the Reserve Bank reserves the right to review the grant of permission to accept public deposits.

(4) Any change in the shareholding pattern / capital structure of a SPD shall need prior approval of the Reserve Bank. SPDs shall report any other material changes such as business profile, organization, etc. affecting the conditions of licensing as SPD to the Reserve Bank immediately.

B. Application for prior Approval

7. An NBFC shall submit an application, through PRAVAAH, in the company’s letter head, for obtaining prior approval of the Reserve Bank, along with the following documents:

(1) information about the proposed shareholders as per Annex I;

(2) sources of funds of the proposed shareholders acquiring the shares in the NBFC;

(3) declaration by the proposed shareholders that they are not associated with any unincorporated body that is accepting public deposits;

(4) declaration by the proposed shareholders that they are not associated with any company, the application for Certificate of Registration (CoR) of which has been rejected by the Reserve Bank;

(5) declaration by the proposed shareholders that there is no criminal case, including for offence under Section 138 of the Negotiable Instruments Act, 1881 against them;

(6) bankers’ report on the proposed shareholders.

C. Requirement of prior Public Notice about Change in Control/ Management

8. Without prejudice to the requirements in the paragraph 6, a public notice shall be given in at least one leading national and in one leading local (covering the place of registered office) vernacular newspaper, at least 30 days before effecting: (i) the transfer of the ownership of the company by sale of shares, or (ii) transfer of control of the company, with or without sale of shares.

Provided that nothing contained in this paragraph shall apply in case of any change in shareholding of an HFC accepting/ holding public deposits, including progressive increases over time, which would result in acquisition/ transfer of shareholding of 10 per cent or more and less than 26 per cent of the paid-up equity capital of the HFC by/to a foreign investor.