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RBI Compliance - Digital Lending App


1. These guidelines are applicable to digital lending extended by:

1.1. All Commercial Banks,

1.2. Primary (Urban) Co-operative Banks, State Co-operative Banks, District Central Co-operative Banks; and

1.3. NBFC - Non-Banking Financial Companies (including Housing Finance Companies)

2. Definitions

2.1. Annual Percentage Rate (APR): APR is the effective annualised rate charged to the borrower of a digital loan. APR shall be based on an all-inclusive cost and margin including cost of funds, credit cost and operating cost, processing fee, verification charges, maintenance charges, etc., and exclude contingent charges like penal charges, late payment charges, etc.

2.2. Cooling off/look-up period: A cooling off/ look-up period is the time window as determined by the Board of the RE which shall be given to borrowers for exiting digital loans, in case a borrower decides not to continue with the loan.

2.3. Digital Lending: A remote and automated lending process, largely by use of seamless digital technologies for customer acquisition, credit assessment, loan approval, disbursement, recovery, and associated customer service.

2.4. Digital Lending Apps/Platforms (DLAs): Mobile and web-based applications with user interface that facilitate digital lending services. DLAs will include apps of the Regulated Entities (REs) as well as those operated by Lending Service Providers (LSPs) engaged by REs for extending any credit facilitation services in conformity with extant outsourcing guidelines issued by the Reserve Bank.

2.5. Lending Service Provider (LSP): An agent of a Regulated Entity who carries out one or more of lender’s functions or part thereof in customer acquisition, underwriting support, pricing support, servicing, monitoring, recovery of specific loan or loan portfolio on behalf of REs in conformity with extant outsourcing guidelines issued by the Reserve Bank.

2.6. Regulated Entities (REs): The entities to whom this circular is applicable as stated at Para 1 of these guidelines.

A. Customer Protection and Conduct requirements

3. Loan Disbursal, Servicing and Repayment - REs shall ensure that all loan servicing, repayment, etc., shall be executed by the borrower directly in the RE’s bank account without any pass-through account/ pool account of any third party. The disbursements shall always be made into the bank account of the borrower except for disbursals covered exclusively under statutory or regulatory mandate (of RBI or of any other regulator), flow of money between REs for co-lending transactions2 and disbursals for specific end use, provided the loan is disbursed directly into the bank account of the end-beneficiary. REs shall ensure that in no case, disbursal is made to a third-party account, including the accounts of LSPs and their DLAs, except as provided for in these guidelines.

4. Collection of fees, charges, etc.

4.1. Payment of Fees/Charges: REs shall ensure that any fees, charges, etc., payable to LSPs are paid directly by them (REs) and are not charged by LSP to the borrower directly.

4.2. Penal Interest/ Charges: The penal interest/charges levied, if any, on the borrowers shall be based on the outstanding amount of the loan. Further, rate of such penal charges shall be disclosed upfront on an annualized basis to the borrower in the Key Fact Statement (KFS).

5. Disclosures to borrowers

5.1. Annual Percentage Rate (APR) - APR as all-inclusive cost of digital loans for the borrower shall be disclosed upfront by REs and shall also be a part of the Key Fact Statement.

5.2. Key Fact Statement

5.2.1. REs shall provide a Key Fact Statement (KFS) to the borrower before the execution of the contract in a standardized format for all digital lending products. The format of KFS is provided in Annex-II.

5.2.2. The KFS shall, apart from other necessary information, contain the details of APR, the recovery mechanism, details of grievance redressal officer designated specifically to deal with digital lending/ FinTech related matter and the cooling-off/ look-up period.

5.2.3. Any fees, charges, etc., which are not mentioned in the KFS cannot be charged by the REs to the borrower at any stage during the term of the loan.

5.3. Digitally signed documents – REs shall ensure that digitally signed documents3 (on the letter head of the RE) viz., KFS, summary of loan product, sanction letter, terms and conditions, account statements, privacy policies of the LSPs/DLAs with respect to borrowers data, etc. shall automatically flow to the borrowers on their registered and verified email/ SMS upon execution of the loan contract/ transactions.

5.4. List of LSPs – REs shall prominently publish the list of their DLAs, LSPs engaged by them and DLAs of such LSPs with the details of the activities for which they have been engaged, on their website.

5.5. Product information – REs shall ensure that their DLAs or DLAs of their LSPs at on-boarding/sign-up stage, prominently display information relating to the product features, loan limit and cost, etc., so as to make the borrowers aware of these aspects.

5.6. Details of recovery agent – REs shall communicate to the borrower, at the time of sanctioning of the loan and also at the time of passing on the recovery responsibilities to an LSP or change in the LSP responsible for recovery, the details of the LSP acting as recovery agent who is authorised to approach the borrower for recovery.

5.7. Link to website - REs shall ensure that DLAs of REs and LSPs have links to REs’ website where further/ detailed information about the loan products, the lender, the LSP, particulars of customer care, link to Sachet Portal, privacy policies, etc. can be accessed by the borrowers. It shall be ensured that all such details are available at a prominent single place on the website for ease of accessibility.

6. Grievance Redressal

6.1. Nodal grievance redressal officer - REs shall ensure that they and the LSPs engaged by them shall have a suitable nodal grievance redressal officer to deal with FinTech/ digital lending related complaints/ issues raised by the borrowers. Such grievance redressal officer shall also deal with complaints against their respective DLAs. Contact details of grievance redressal officers shall be prominently displayed on the websites of the RE, its LSPs and on DLAs and also in the KFS provided to the borrower. Further, the facility of lodging complaint shall also be made available on the DLA and on the website as stated above. It is reiterated that responsibility of grievance redressal shall continue to remain with the RE.

6.2. If any complaint lodged by the borrower against RE or the LSP engaged by the RE is not resolved by the RE within the stipulated period (currently 30 days), he/she can lodge a complaint over the Complaint Management System (CMS)4 portal under the Reserve Bank-Integrated Ombudsman Scheme (RB-IOS)5. For entities currently not covered under RB-IOS, complaint may be lodged as per the grievance redressal mechanism prescribed by the Reserve Bank.

7. Assessing the borrower’s creditworthiness

7.1. REs shall capture the economic profile of the borrowers covering (age, occupation, income, etc.), before extending any loan over their own DLAs and/or through LSPs engaged by them, with a view to assessing the borrower’s creditworthiness in an auditable way.

7.2. REs shall ensure that there is no automatic increase in credit limit unless explicit consent of borrower is taken on record for each such increase.

8. Cooling off/look-up period – 

A borrower shall be given an explicit option to exit digital loan by paying the principal and the proportionate APR without any penalty during this period. The cooling off period shall be determined by the Board of the RE. The period so determined shall not be less than three days for loans having tenor of seven days or more and one day for loans having tenor of less than seven days. For borrowers continuing with the loan even after look-up period, pre-payment shall continue to be allowed as per extant RBI guidelines6.

9. Due diligence and other requirements with respect to LSPs

9.1. REs must conduct enhanced due diligence before entering into a partnership with a LSP for digital lending, taking into account its technical abilities, data privacy policies and storage systems, fairness in conduct with borrowers and ability to comply with regulations and statutes.

9.2. REs shall carry out periodic review of the conduct of the LSPs engaged by them.

9.3. REs shall impart necessary guidance to LSPs acting as recovery agents to discharge their duties responsibly and ensure that they comply with the extant instructions7 in this regard.

10. Technology and Data Requirement

Collection, usage and sharing of data with third parties

10.1. REs shall ensure that any collection of data by their DLAs and DLAs of their LSPs is need-based and with prior and explicit consent of the borrower having audit trail. In any case, REs shall also ensure that DLAs desist from accessing mobile phone resources like file and media, contact list, call logs, telephony functions, etc. A one-time access can be taken for camera, microphone, location or any other facility necessary for the purpose of on-boarding/ KYC requirements only, with the explicit consent of the borrower.

10.2. The borrower shall be provided with an option to give or deny consent for use of specific data, restrict disclosure to third parties, data retention, revoke consent already granted to collect personal data and if required, make the app delete/ forget the data.

10.3. The purpose of obtaining borrowers’ consent needs to be disclosed at each stage of interface with the borrowers.

10.4. Explicit consent of the borrower shall be taken before sharing personal information with any third party, except for cases where such sharing is required as per statutory or regulatory requirement.

11. Storage of data

11.1. REs shall ensure that LSPs/DLAs engaged by them do not store personal information of borrowers except some basic minimal data (viz., name, address, contact details of the customer, etc.) that may be required to carry out their operations. Responsibility regarding data privacy and security of the customer’s personal information will be that of the RE.

11.2. REs shall ensure that clear policy guidelines regarding the storage of customer data including the type of data that can be stored, the length of time for which data can be stored, restrictions on the use of data, data destruction protocol, standards for handling security breach, etc., are put in place and also disclosed by DLAs of the REs and of the LSP engaged by the RE prominently on their website and the apps at all times.

11.3. REs shall ensure that no biometric data is stored/ collected in the systems associated with the DLA of REs/ their LSPs, unless allowed under extant statutory guidelines.

11.4. REs shall ensure that all data is stored only in servers located within India, while ensuring compliance with statutory obligations/ regulatory instructions.

12. Comprehensive privacy policy

12.1. REs shall ensure that their DLAs and LSPs engaged by them have a comprehensive privacy policy compliant with applicable laws, associated regulations and RBI guidelines. For access and collection of personal information of borrowers, DLAs of REs/LSPs should make the comprehensive privacy policy available publicly.

12.2. Details of third parties (where applicable) allowed to collect personal information through the DLA shall also be disclosed in the privacy policy.

13. Technology standards – 

REs shall ensure that they and the LSPs engaged by them comply with various technology standards/ requirements on cybersecurity stipulated by RBI and other agencies, or as may be specified from time to time, for undertaking digital lending.

C. Regulatory Framework

14. Reporting to Credit Information Companies (CICs)

14.1. As per the provisions of the Credit Information Companies (CIC) (Regulation) Act, 2005; CIC Rules, 2006; CIC Regulations, 2006 and related guidelines issued by RBI from time to time, REs shall ensure that any lending done through their DLAs and/or DLAs of LSPs is reported to CICs irrespective of its nature/ tenor.

14.2. Extension of structured digital lending products by REs and/or LSPs engaged by REs over a merchant platform involving short term, unsecured/ secured credits or deferred payments, need to be reported to CICs by the REs. REs shall ensure that LSPs, if any, associated with such deferred payment credit products shall abide by the extant outsourcing guidelines issued by the Reserve Bank and be guided by these guidelines.

15. Loss sharing arrangement in case of default:

As regards the industry practice of offering financial products involving contractual agreements such as First Loss Default Guarantee (FLDG) in which a third party guarantees to compensate up to a certain percentage of default in a loan portfolio of the RE, it is advised that REs shall adhere to the provisions of the Master Direction – Reserve Bank of India (Securitisation of Standard Assets) Directions, 2021 dated September 24, 2021, especially, synthetic securitisation8 contained in Para (6)(c).

----- --------- --------
1 Para 2.6 of the Master Circular on “Loans and Advances – Statutory and Other restrictions” dated July 01, 2015; Guidelines on Managing Risks and Code of Conduct in Outsourcing of Financial Services by Banks issued vide Circular dated November 03, 2006 as amended from time to time; Para 120 and 120 A of “Master Direction - Non-Banking Financial Company - Systemically Important Non-Deposit taking Company and Deposit taking Company (Reserve Bank) Directions, 2016” dated September 01, 2016, as amended from time to time; Para 106 and 106A of the ‘Master Direction - Non-Banking Financial Company – Non-Systemically Important Non-Deposit taking Company (Reserve Bank) Directions, 2016’ both dated September 01, 2016, as amended from time to time; ‘Guidelines for Managing Risk in Outsourcing of Financial Services by Co-operative Banks’, dated June 28, 2021; Circular on ‘Outsourcing of Financial Services - Responsibilities of regulated entities employing Recovery Agents’ dated August 12, 2022, and other related instructions issued by the Reserve Bank from time to time.

2 Co-lending arrangements shall be governed by the extant instructions as laid down in the Circular on Co-lending by Banks and NBFCs to Priority Sector dated November 05, 2020, and other related instructions.

3 Digitally signed means a document signed using digital signature.

4 https://cms.rbi.org.in/

5 Issued vide Notification CEPD. PRD. No.S873/13.01.001/2021-22 dated November 12, 2021

6 In terms of Circular DBR.Dir.BC.No.08/13.03.00/2019-20 for banks and DNBR (PD) CC.No.101/03.10.001/2019-20 for NBFCs on “Levy of Foreclosure Charges /Pre-payment Penalty on Floating Rate Term Loans”, both dated August 02, 2019.

7 Circular DOR.ORG.REC.65/21.04.158/2022-23 on ‘Outsourcing of Financial Services - Responsibilities of regulated entities employing Recovery Agents’ dated August 12, 2022, and other relevant instructions as issued from time to time.

8 “synthetic securitisation” means a structure where credit risk of an underlying pool of exposures is transferred, in whole or in part, through the use of credit derivatives or credit guarantees that serve to hedge the credit risk of the portfolio which remains on the balance sheet of the lender.

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Compliance Advisory
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How to Change the Name of NBFC?

The name of the company may be such which reflects the business activity or it might be something simple & easy. There are abundant factors which are considered while finalizing a suitable name because in Long run the name will be a Brand. Sometimes, there arises a requirement to change the existing name of a Company due to change in its objects, corporate restructurings etc. Whatever might be the reason, Change of the name of a Company can only be done after complying with laws applicable to the Company. The legal provisions and procedure are discussed here in detail.
  • The Altered name should be painted/affixed outside Registered & every office
  • Getting a new Common seal for the Company & make the alteration in every copy of MOA & AOA.
  • Change the stationery with new name stationary viz. Letterheads, Bill heads etc.
For alteration in the Name of NBFC one require a prior approval from RBI and then MCA can allow one to amend the MOA.
  • Name reservation from MCA
  • Notice to RBI for change in Name of the NBFC
  • Public notice of change in Name of NBFC
  • MGT-14 filing with MCA
  • NBFC RBI Compliance 

Procedure to Change the Name of NBFC?

The Name change procedure of NBFC is very much similar to similar to non-NBFC Company except for the requirement of RBI Approval in advance. Name Change in a company usually is done due to change in business activity of the company. The name change also occurs if there is a change in management of the company. If an NBFC requires changing its name, it requires passing a special resolution in a board meeting. The minutes of the meeting needs to be submitted to the Ministry of Corporate Affairs (MCA) with the request for name change.

Step by step Analysis for Change in the Name of NBFC

  • One require prior RBI approval for change in names of NBFC
    Rest procedure will be same as a normal private or public limited company

  • Board Resolution

The board will authorize the change in the name of the NBFC & authorize a director or company secretary to do the necessary filing with the MCA by consideration of proposal of change of name & determining maximum 6 alternative names. A decision to convene another board meeting for a change of name (after approval) and to make changes in the Memorandum and Articles of Association (MOA & AOA) is made in the same meeting.

  • Name Availability

Check the name availability at MCA and on trademark website. The new name shall be in adherence to the naming guidelines provided in the Companies Act, 2013.

  • Filing of INC-1

The necessary form needs to be filed with ROC with the attachment of RBI NOC and the board resolution as well along with other requirements of the form to get final approval from the concerned ROC.

  • Filing of MGT-14 & INC-24

Within 30 days of passing the special resolution for a name change, the company needs to file form MGT-14 with MCA with the attachment of Notice of extraordinary general meeting along with the explanatory statements; certified a true copy of the Special resolution passed; Altered MOA and AOA; and Minutes of the EGM. After filing form MGT-14 you need to file form INC-24 with CG along with Notice of EGM along with the explanatory statements, CTC of Special resolutions, altered MOA & AOA and Minutes of the extraordinary general meeting.

  • Final Approval from MCA

One needs to file necessary form with ROC with the attachment of RBI NOC as well along with other requirements of the form and get final approval from the concerned ROC. After getting the name approval from ROC, the original Certificate of Registration as issued by the concerned Reserve Bank of India needs to be surrendered to the same department of Non-Banking’s supervision to get new Certificate of Registrations as Non-Banking Finance Company with new name reissued by the concerned Department.

  • Public Notice of change in the Name of NBFC

For changing the name of the company, you need to publish an advertisement in the in an English newspaper and in a Vernacular language newspaper where the registered office of the company is situated.


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Timelines for RBI Regulatory Approval & Permission


I. Department of Banking Regulation
Sr. No. Description of Regulatory Approval Time required
1. Private Bank Licence- In principle approval 90 days@
2. Approval to banks for acquisition/transfer of shares of five per cent or more of paid up equity share capital of the bank 90 days
3. Approval to banks for holding non-banking assets beyond 7 and up to 12 years, in terms of Section 9 of Banking Regulation Act, 1949 15 days
4. Approval to banks for redemption of subordinated debt 15 days
5. Approval to banks for establishing a subsidiary/joint venture/associate/making strategic investments in financial services companies 45 days
6. Approval to banks for offering activities such as investment advisory services, portfolio management services or venturing into stock broking, mutual funds, venture capital funds, insurance or pension management departmentally 45 days
7. Permission to banks for expanding the scope of para-banking activities of the bank/its subsidiary 45 days
8. Permission to banks to retain investments in non-financial services companies beyond the prescribed prudential limits 45 days
9. Approval to foreign banks having their business in India for substitution of Government / approved Securities held under Section 11(2)(b) of the Banking Regulation Act, 1949 5 days
10. Approval to foreign banks having their business in India for deposit/withdrawal of Government / approved Securities held under Section 11(2)(b) of the Banking Regulation Act, 1949 5 days
11. Appointment / re-appointment of whole time directors (MD & CEO / EDs/ Jt. MDs ) and Part-time Chairmen (non-whole time directors) in Private Sector Banks, including LABs 90 days
12. Appointment / re-appointment of CEOs of Foreign Banks operating in India 90 days
13. Remuneration, Bonus and Employee Stock Option(ESOP) of whole time directors (MD & CEO / EDs/ Jt. MDs ) and Part-time Chairmen (non-whole time directors) of Private Sector Banks, including LABs 60 days
14. Remuneration, Bonus and Employee Stock Option of CEOs of Foreign Banks operating in India 60 days
15. Clearances for appointment of whole time directors, non-executive chairmen and non-official directors of public sector banks 60 days
16. Approval of Annual Banking Outlet Expansion Plan (ABOEP) in respect of Domestic Scheduled Commercial Banks (excluding RRBs) for which the general permission has been withdrawn and for Small Finance Banks, Payment Banks and Local Area Banks 45 days
17. Advances to banks’ Directors 90 days
18. Staff Incentive Schemes by banks for deposit mobilization 90 days
19. Authorisation for import of gold/silver by banks 60 days
20. Authorization for opening of banking outlets under approved ABOEP 30 days
@The timeline for issue of in-principle approval for private sector bank licences commences from receipt of report from the Independent External Advisory Committee.


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Regional Rural Banks
21. Inclusion in/Exclusion from Second Schedule of RBI Act 45 days
22. Permission for opening of branches/ issue of licence for branches/ service branches/ Regional Offices 45 days
23. Permission for shifting of branches outside the locality/municipal ward at semi-urban/ urban/ metropolitan centres 45 days
24. Permission for conversion of satellite offices/ extension counters into full-fledged branches 45 days
25. Permission for opening of extension counters/ ultra-small branches 45 days
26. Appropriation from the Reserve Fund under Section 17(2) of the BR Act, 1949 45 days

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II. Department of Banking Supervision
Sr. No. Description of Regulatory Approval Time required
1. Approval given to banks and Financial Institutions for Statutory Central Auditors and Statutory Branch Auditors
i) Public Sector Banks:
a) Statutory Central Auditors 15 days
b) Statutory Branch Auditors 30 days
ii) Private Sector Banks/Foreign Banks:
a) Statutory Central Auditors 30 days
b) Statutory Branch Auditors 30 days
iii) Overseas branches of Indian Banks:
Statutory Auditors 30 days
iv) Select Financial Institutions:
Statutory Auditors 21 days


III. Department of Currency Management/ Issue Department
Sr. No. Description of Regulatory Approval Time required
1. Opening of currency chests (CCs) by banks The Approvals will normally be accorded within 30 days provided the construction conforms to the specifications
IV. Department of Non-Banking Regulation
Sr. No Description of Regulatory Approval Time required
SRO
1. Recognition to Self-Regulatory Organisation (SRO) 45 days
Non-Banking Finance Companies(NBFCs)
2. Issue of Certificate of Registration
(other than Securitization and Reconstruction Companies)		 45 days
3. NOC to sponsor Infrastructure Debt Fund by NBFC 30 days
4. Change of control/ownership/management of an NBFC 30 days
5. Conversion of existing NBFCs to other categories such as Core Investment Companies-Non Deposit taking-Systemically Important (CIC-ND-SI) , NBFC-Micro Finance Institutions (NBFC-MFIs), NBFC-Infrastructure Finance Companies (IFCs) and NBFC-Factors 30 days
6 Change in shareholding pattern 45 days
7 Declaration of dividend– (In case there are special reasons or difficulties for any PD in strictly adhering to the guidelines relating to Dividend, it may approach RBI in advance for an appropriate ad hoc dispensation in this regard)           45 days


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V. Department of Non-Banking Supervision
Sr. No Description of Regulatory Approval Time required
Non-Banking Finance Companies(NBFCs)
1. Change of name 30 days
2. Shifting of company’s Registered Office and request for issue of fresh Certificate of Registration 30 days
3 Issue of NOC for setting up of subsidiary/ Wholly Owned Subsidiary overseas 30 days
4 Approval for exemption from the exposure norms in cases where public funds are not accepted 30 days
5 Permission to invest in insurance companies 30 days
6 Permission to convert NBFC from Category A (Accepting Deposits) to Category B (Non-Deposit Accepting) 30 days
7 Opening of branches (> 1000 in number) by NBFCs primarily into lending against gold jewellery 30 days
8. Opening of branches by NBFCs-Deposit taking 30 days
9. Issue of co-branded credit cards and pre-paid payment instruments 30 days
10. Distribution of mutual fund products 30 days

VI. Department of Payment and Settlement Systems
Sr. No. Description of Regulatory Approval Time required
Financial Market Infrastructure
1. Authorisation for Financial Market Infrastructure e.g. Central Counter Party, Trade Repository, etc. 120 days @
Retail Payment System
2. Authorisation for Retail Payment System (including Card Payment Networks, Cross Border Money Transfer, ATM Network, Prepaid Payment Instrument Operators, White Label ATM Operators, etc.) 120 days #
@ –The proposals are put up for approval to Board for Regulation and Supervision of Payment and Settlement Systems (BPSS). BPSS ordinarily meets once in three months.
# – Payment and Settlement Systems Act, 2007 [Sec 7(4)] states that RBI shall endeavour to dispose of applications for Authorisation within six months from the date of filing. The proposals are approved by the BPSS. BPSS ordinarily meets once in three months.


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VII. Foreign Exchange Department
Sr. No. Description of Regulatory Approval Time required
1. a) Trade Credit under approval route 7 days
b) Post servicing of External Commercial Borrowing (ECB)/ Foreign Currency Convertible Bond (FCCB) under Automatic and Approval route 15 days
c) ECB/FCCB proposals under Approval route 30 days
2. NOC/approval for

a) Employee Stock Ownership Plan(ESOP) not covered under general permission
b) Rights Issue not covered under general permission
c) Permission for investment by erstwhile Overseas Corporate Body(OCB)
d) NOC for repatriation of share application money beyond 180 days
e) Extension for retention of share application money beyond 180 days
f) Conversion of shares from non-repatriation basis to repatriation basis
g) Approval for holding share application money in foreign currency in India/ abroad
h) Approval for registration of Foreign Venture Capital Investor(FVCI)
i) Increase in holdings in a company beyond the limit to 24 % up to sectoral cap/ statutory ceiling		 30 days
j) Approval for Pledge of shares 40 days
3. Receipt of Capital Contribution 30 days
4. a)Transfer of shares from Non Resident Indian (NRI) to Non Resident(NR) 40 days
b) Gift of shares from Resident to NRI
c) Delay in reporting
d) Permission for opening of escrow account by Authorised Dealer(AD) Category – I bank beyond the period of 6 months for effecting transfer of shares		 60 days
5. a) Permission for establishment of new Liaison Office(LO)/ Branch Office(BO) in India under Approval Route 40 days
b) Approval for establishing additional LO/BO in India.
c) Permission for shifting LO/BO to another city.		 10 days on receipt of Government approval
d) Permission for opening LO/BO/ Project Office(PO) by entities from China, Hong Kong, Macau, Pakistan, Bangladesh, Afghanistan, Sri Lanka and Iran 10 days on receipt of Government approval
e) Permission for establishing PO in India which require GOI approval 10 days on receipt of Government approval
6. Permission to open foreign currency account in India 60 days
7. To open foreign currency account outside India 60 days
8. To open Non Resident Ordinary(NRO) account in consultation with the MoF, GoI 30 days on receipt of Government approval
9. To receive salary outside India in foreign currency account 90 days
10. For transfer/acquisition of immovable property not covered under general permission in terms of Foreign Exchange Management Act, 1999 or the rules/ regulations made thereunder 30 days on receipt of Government approval
11. Approvals given for proposals regarding miscellaneous external payments of permissible Current and Capital Account transactions 30 days
12. a) Investment in Overseas Joint Ventures and Wholly Owned Subsidiary(WOS) (not covered by automatic route)
b) Other overseas Investment under approval route		 40 days
c) Disinvestment of shares in Overseas Joint Ventures / Subsidiaries 40 days
d) Allotment of Unique Identification Number (UIN) Instant online allotment
13. Issue and Renewal of fresh AD Category Cat-I licence 30 days
14. Issue of fresh AD Cat-II licence 90 days
15. Issue and Renewal of fresh AD Cat-III licence 30 days
16. Issue of fresh licence to conduct Money Transfer Service Scheme(MTSS) business 45 days
17. Issue of first permission to undertake Rupee Drawing Arrangement (RDA) scheme 30 days
18. Approvals to take Insurance policies from insurance companies in foreign countries. 7 days
19. Compounding of contraventions of FEMA 180 days
20. Issue/ Renewal of Money Changer’s licence 40 days

VIII. Financial Markets Operation Department
Sr. No. Description of Regulatory Approval Time required
2. Intra-day Limit (IDL) setting for RTGS members 7 days*
*The timeline indicates clear working days, excluding date of receipt of application.

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IX. Financial Markets Regulation Department
Sr. No. Description of Regulatory Approval Time required
1 One time Permission to Authorised Dealer category–I bank for running FCY-INR options book 30 days
2 Authorisation to Currency Futures Exchanges/ Clearing Corporations u/s 10(1) of FEMA 1999 30 days
3 NDS-OM membership 7 days*
4 NDS-CALL membership 7 days*
*Timeline indicates clear working days, excluding date of receipt of application complete in all respects.
X. Internal Debt Management Department
Sr. No. Description of Regulatory Approval Time required
Bank Primary Dealers (carrying PD business departmentally)
1. 1. License for Primary Dealer Business 90 days
2. Termination of PD license 90 days
Standalone Primary Dealers
2. 1. License for Primary Dealer Business 90 days
2. Termination of PD license 90 days
3. For undertaking Portfolio Management Services 60 days
4. To act as market makers in the Credit Default Swaps (CDS) 45 days
5. Diversification of activities by PD 45 days


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XI. Department of Co-operative Bank Regulation (DCBR)
A. Approvals/Permissions given by Central Office for Primary Urban Cooperative Banks
Sr. No. Description of Regulatory Approval Time required
1. Approvals/Permissions given by Central Office for UCBs
1. Extension of Area of Operation
i) beyond adjoining districts and to the entire State of registration
ii) beyond the State of registration
iii) for multi-state UCBs		 90 days
2. Shifting of branches – Request from UCBs not conforming to the FSWM (Financially Sound and Well Managed) criteria for shifting of their offices/branches outside the centre/State 90 days
3. Shifting of branches of UCBs outside the State of registration 90 days
4. Permission to undertake intra-day short selling of G-Secs 90 days
5. Permission to extend unsecured advances up to 25% of total assets subject to conditions prescribed in our circular dated April 3, 2010 90 days
6. Remission of Debt of Director related loans 90 days
7. Grant of permission for raising Long Term (Subordinated) Deposits (LTD)/ Perpetual Non-Cumulative Preference Shares (PNCPS)/ Conversion of deposits to equity 90 days
2. Approvals/Permissions given by Regional Offices for UCBs
8. Shifting of offices to different wards/municipal areas 45 days
9. Extension of time for submission of Form – V (Furnishing of details of Branches opened) 90 days
10. Change of address to same municipal ward, post issue of authorization but before opening of branch 90 days
11. Authorisation for opening of branches under Annual Business Plan and new off-site ATMs 90 days
12. Approval for opening of specialized branches by UCBs 90 days
13. Permission to extend internet banking facility to customers 90 days
14. Permission for payment of dividend 90 days
15. Change in name of bank 90 days
16. Authorization to maintain/renew NRE accounts 90 days
3. Other applications received by the Department for recommendations but approvals/permissions granted by other Departments /Organisations for UCBs
17. Approvals related to Centralised Payment System 45 days
18. MTSS 45 days
19. AD-I and AD-II category licences 45 days
20. Opening of current account/SGL account 45 days
21. Clearing House memberships 45 days
22. NDS-OM Membership 45 days
23. Permission to extend mobile banking to customers 45 days
24. Banker to Issue 45 days
25. Merchant Banking 45 days


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B. Regulatory Approval for State and Central Cooperative Banks
1. Regulatory approvals granted without involving other departments/agencies
Sr. No. Description of Regulatory Approval Time required
State and Central Co-op. Banks
1. Grant of loan/advance against the security of NRE deposits to a resident individual/ firm/ company in India 30 days
2. Disposal of non-banking assets 30 days
3. Investment in shares of other Co-operative Societies situated outside the area of the co-operative bank 30 days
4. Permission to make investments in non-SLR securities 30 days
5. Retirement of investments made in the deposits of PSUs / Companies / Corporations / UCBs / NBFCs, etc. and investments in mutual funds, non- PSU bonds – Approval of time-bound programme by Regional Office 30 days

2. Regulatory approvals involving inter-office/inter-agency coordination
Sr. No. Description of Regulatory Approval Time required
State and Central Co-op. Banks
1. Grant of banking licence 30 days
2. Permission to make investments in non-PSU bonds where prescribed criteria are not met 30 days
3. Permission to issue Long Term (Subordinated) Deposits and Innovative Perpetual Debt Instruments 30 days
4. Permission to take up insurance business and renewal thereof 30 days
5. Permission for commencing co-branded credit card business and renewal of permission 30 days
State Co-op. Banks
6. Grant of branch licence to State Co-op. banks 30 days
7. Grant of permission to open Extension Counters 30 days
8. Permission for opening specialized branches for conducting forex business, etc., and for up-gradation of existing extension counters into full-fledged branches 30 days
9. Permission for shifting of a bank branch to a different locality/municipal ward other than the one mentioned in the licence 30 days
10. Inclusion in the 2nd Schedule to RBI Act 1934 30 days


Foot Note:
  1. All the above estimated timelines for regulatory approvals of various departments (I to XI) are anticipated to be met by in most cases, but a few may exceed these timelines.
  2. If departments are likely to exceed the timeline, they will revert to the applicant.
  3. In case an applicant does not get a response within the indicated timeline, they can approach the head of the concerned department. The department head will respond with the status of the application, the reason for delay, request for additional information, if any, as well as likely time for disposal of the application.
  4. In some situations, a change in procedure or in the environment will change the estimated time for action. In such cases, the timeline for approval will be modified appropriately.
  5. The timelines given in column 3 for all above Departments (I to XI) are subject to receipt of complete information/ documents from the banks/ institutions concerned as well as receipt of regulatory/ supervisory inputs/ due diligence reports/ approvals from other regulators and the concerned Government Agencies/ Departments.



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