NBFC

-Returns & Disclosure

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 NBFC - Returns & Disclosure
Quick Reference Guide
for Private Circulation Only

Foreword

CA Kala Jayesh Umedmal

B.Com FCA
Candidate: WIRC of ICAI Election 2024
Humble Request for first preference Vote
at Ballot No. 23

The regulatory environment for Non-Banking Financial Companies (NBFCs) has evolved
significantly, emphasizing financial stability, transparency, and robust compliance
frameworks. Chartered Accountants (CAs) play a pivotal role in guiding NBFCs through
these dynamic regulations and ensuring adherence to the stringent guidelines laid out by
the Reserve Bank of India (RBI).

NBFCs, as defined under the RBI Act, 1934, are identified by meeting two key criteria—
financial assets must constitute more than 50% of total assets, and income from these
financial assets must exceed 50% of gross income. These institutions are vital in bridging
financial gaps and driving economic growth by serving areas underserved by traditional
banking.

The Master Direction: Reserve Bank of India (Non-Banking Financial Company – Scale Based
Regulation) Directions, 2023 categorizes NBFCs into four distinct layers—Base, Middle,
Upper, and Top—according to their asset size and associated risks.

Additionally, the Master Direction – RBI (Filing of Supervisory Returns) Directions –

2024 outlines that all Supervised Entities (SEs) are required to submit certain supervisory
returns to the Reserve Bank as per various directions / circulars/ notifications issued by the
Bank from time to time.

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CA Vardhman Chhalani

I would like to extend my heartfelt thanks to CA Vardhman Chhalani for his invaluable
support and contributions. Your assistance has been instrumental in bringing this
publication to fruition.

Thank you for your commitment to excellence. Let us continue to seize new opportunities
for growth and work collectively toward a brighter future for the profession and I look
forward to any questions you may have.

To stay updated and connected, I invite you to join the following groups:

1. JK’s Portfolio Enhancement Group:

https://chat.whatsapp.com/FoG0Epx5sEb1dbZv0Q0XA9

2. Professional Opportunities Updates by CA Jayesh Kala:

https://chat.whatsapp.com/GwM3xOD65gS6hkOa8zYBP6

3. NFRA Updates by CA Jayesh Kala:

https://chat.whatsapp.com/FKfKsaMUCPrKfsKv7Ok8ok

With Warm Regards,

CA Kala Jayesh Umedmal

Your Candidate for ICAI- WIRC Elections 2024
Ballot No. 23
Dedicated to Profession – Committed to Fraternity

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Master Direction: Reserve Bank of India (Non-Banking Financial Company – Scale Based
Regulation) Directions, 2023
RBI/DoR/2023-24/106 DoR.FIN.REC.No.45/03.10.119/2023-24
Date of Issuance: October 19, 2023
(Updated as on October 10, 2024, Updated as on March 21, 2024, Updated as on November 10,
2023)
Classification of NBFC’s Description Key Features/Activities
Base Layer (BL) Non-deposit taking NBFCs below » NBFC-Peer to Peer Lending
Rs. 1,000 crore asset size. Platform (NBFC- P2P)
» NBFC-Account Aggregator
(NBFC- AA)
» Non-Operative Financial
Holding Company (NOFHC)
» NBFC not availing public funds
and not having any customer
interface

Middle Layer (ML) All deposit taking NBFCs and » Standalone Primary Dealer
non-deposit taking NBFCs with (SPD)
asset size of ₹1,000 crore and » Infrastructure Debt Fund-
above. NBFC (IDF-NBFC)
» Core Investment Company
(CIC)
» Housing Finance Company
(HFC)
» NBFC-Infrastructure Finance
Company (NBFC-IFC)

Upper Layer (UL) NBFCs identified by the Reserve » Top ten NBFCs by asset size
Bank for enhanced regulatory always included irrespective of
requirements based on set any other factor.
of parameters and scoring
methodology as mentioned in
the circular

Top Layer (TL) Ideally empty; populated only if » NBFCs move from Upper to Top
RBI is of the opinion that there Layer if significant systemic
is a substantial increase in the risk is identified
potential systemic risk increases
in specific Upper Layer NBFCs.

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Master Direction – Reserve Bank of India (Filing of Supervisory Returns) Directions – 2024
RETURNS APPLICABLE TO NBFCs
vide notification no. RBI/DoS.DSG / 2023-24/110 DoS.DSG.No.10/33.01.001/2023-24 dated Febru-
ary 27, 2024
S. No. Forms Particulars Periodicity Applicability Description
(with reference to NBFC)
1. DNBS01 Important Quarterly i. NBFC - Upper Layer Components of
Financial (NBFC-UL), assets and liabilities,
Parameters ii. NBFC - Middle Layer profit and loss
(NBFC-ML) [except account, exposure
NBFC-Core Investment to sensitive sectors,
Companies (CICs)] sectoral credit etc.

2. DNBS02 Important Quarterly NBFCs in Base Layer [except Contains financial

Financial Peer-to-Peer Lending details, viz.
Parameters platform Companies (NBFC components of
(NBFCs – BL) – P2Ps)] assets and liabilities,
profit and loss
account etc. as well
as for complying with
various Prudential
norms.

3. DNBS03 Important Quarterly i. NBFC-UL, Contains Prudential

Prudential ii. NBFC -ML [except NBFC- norms, e.g.,
Parameters CICs] capital adequacy,
provisioning etc.

4. a. DNBS04A Short Term Quarterly i. NBFC-UL, Data on Asset

Dynamic ii. NBFC-ML [except Liability Mismatches
Liquidity Standalone Primary (ALM) and Interest
(STDL) Dealers (SPDs)], and Rate Sensitivity
iii. NBFC-BL with asset size (IRS), liquidity risk of
of ₹100 crore and above exposures.
solely or at Group level,
[excluding Type-I NBFCs,
and Non-Operative
Financial Holding
Companies (NOFHCs),
P2Ps, AAs, and Mortgage
Guarantee Companies]

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S. No. Forms Particulars Periodicity Applicability Description

(with reference to NBFC)
4. b. DNBS04B Structural Monthly i. NBFC-UL, Data on Asset
Liquidity & ii. NBFC-ML [except Liability Mismatches
Interest Rate Standalone Primary (ALM) and Interest
Sensitivity Dealers (SPDs)], and Rate Sensitivity
iii. NBFC-BL with asset size (IRS), liquidity risk of
of ₹100 crore and above exposures.
solely or at Group level,
[excluding Type-I NBFCs,
and Non-Operative
Financial Holding
Companies (NOFHCs),
P2Ps, AAs, and Mortgage
Guarantee Companies]

5. DNBS08 Central Monthly i. NBFC-UL, Contains certain

Repository of ii. NBFC -ML (except NBFC- credit information in
Information CICs), and respect of borrowers
on Large iii. NBFC-BL which are NBFC- who are having
Credits ICC, NBFC-MFI, NBFC- aggregate exposure
[CRILC-Main Factors having asset size of ₹5 Crore and
(NBFCs)] of ₹500 crore and above above with NBFCs.
solely or at Group level In case, any entity to
whom the return is
applicable does not
have any borrower
with aggregate
exposure of ₹5
crores and above for
a reporting month,
it shall submit a ‘NIL’
return.

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S. No. Forms Particulars Periodicity Applicability Description

(with reference to NBFC)
6. DNBS09 C e n t r a l Weekly i. NBFC-UL, Certain information
Repository of ii. NBFC -ML (except NBFC- on large borrowers
Information CICs), and (having aggregate
on Large iii. NBFC-BL which are NBFC- exposure of ₹5 crores
Credits on ICC, NBFC-MFI, NBFC- and above with
Defaulted Factors having asset size them), who have
Borrowers of ₹500 crore and above defaulted during
[ C R I L C solely or at Group level a week or moved
Weekly – RDB out of the default
return] position, through this
return on each Friday.
In case, any entity
to whom the return
is applicable does
not have any large
borrower with default
move-in/ move-out
positions during the
week, it shall submit
a ‘NIL’ return.

7. DNBS10 Statutory Yearly All NBFCs All NBFCs shall enable

Auditor their Statutory
Certificate Auditors to submit
(SAC) Return ‘DNBS10 - Statutory
Auditor’s Certificate
(SAC) Return’ every
year. The certificate
shall be based on
audited books of
accounts of the
applicable entity,
for the preceding
financial year.
The Statutory Auditor
shall compile,
generate and file
the return, using
the secure login
credentials created
by the applicable
entity.

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S. No. Forms Particulars Periodicity Applicability Description

(with reference to NBFC)
8. DNBS11- Important Quarterly NBFC-CICs Contains data on
CICs Financial assets and liabilities,
Parameters profit and loss
account, exposure
to sensitive sectors,
sectoral credit, etc.

9. DNBS12- Important Quarterly NBFC-CICs Contains data on

CICs Prudential Adjusted Net Worth,
Parameters Provisioning, etc.

10. DNBS13 Overseas Quarterly All NBFCs All the NBFCs

Investment (irrespective of
Details category, business
classification and
asset size) shall
submit information
on their overseas
investment and
returns on a quarterly
basis. In case, there
are no overseas
investments during
the reporting quarter,
a ‘NIL’ return shall be
submitted.

11. DNBS14- Important Quarterly NBFCs- Peer-to-Peer Lending Contains data on

P2Ps Financial & platform Companies (NBFCs- assets and liabilities,
Prudential P2P) profit and loss
Parameters account, prudential
parameters etc.

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S. No. Forms Particulars Periodicity Applicability Description

(with reference to NBFC)
12. Form A Information Annual All NBFCs This certificate to
Certificate to be be submitted by
submitted NBFCs regarding
by the NBFCs appointment of
regarding Statutory Central
Appointment Auditor (SCA)/
of Statutory Statutory Auditor (SA)
C e n t r a l in prescribed format
A u d i t o r as mentioned in the
( S C A ) / RBI’s notification on
Statutory ‘Appointment of
Auditor (SA). Statutory Central
Auditors (SCAs)/
Statutory Auditors
(SAs) of Commercial
Banks (excluding
RRBs), UCBs and
NBFCs (including
HFCs)’

13. FSI Financial Quarterly NBFCs A special return

Soundness for furnishing
Indicators consolidated FSIs:
1. Balance Sheet
2. Income and
E x p e n s e
Statement
3. Select financials,
4. Loans by sectoral
distribution.

14. FMR-I Report on As and NBFC-UL, NBFC -ML, and Report on Actual or
Actual or when NBFC-BL which are NBFC- Suspected Frauds.
Suspected ICC, NBFC-MFI, NBFC-Factors
Frauds having asset size of ₹500
crore and above

15. FMR-III Update of As and NBFC-UL, NBFC -ML, and This return captures
Form FMR-I when NBFC-BL which are NBFC- progress report on
ICC, NBFC-MFI, NBFC-Factors frauds of large value
having asset size of ₹500 and it is to be filed
crore and above as and when any
development occurs
in FMR-I details.

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S. No. Forms Particulars Periodicity Applicability Description

(with reference to NBFC)
16. FMR-IV Report on Quarterly NBFC-UL, NBFC -ML, and This return captures
Dacoities / NBFC-BL which are NBFC- consolidated
Robberies ICC, NBFC-MFI, NBFC-Factors information on
/ Theft / having asset size of ₹500 dacoities/robberies/
Burglaries crore and above theft/ burglaries.

Return Filing Timelines:

Periodicity Reference Date Type of Return Timeline for Return
submission
Weekly Friday of the week DNBS09 On or before Wednesday
of the following week
Monthly Last day (28th/ 29th/ DNBS04B, DNBS08 Within 15 days from the
30th/ 31st) of a respective Reference Date.
month
Quarterly Last day of the Calendar FMR IV Within 15 days from the
Quarter (i.e., March 31st, Reference Date.
June 30th, September DNBS01, DNBS02, Within 21 days from the
30th, and December 31st) DNBS03, DNBS04A, Reference Date
DNBS11, DNBS12,
DNBS13, DNBS14
Yearly March 31st DNBS10 (SAC) Within 5 working days
from the date of signing
of the Auditor’s report
in terms of section 134
of the Companies Act,
2013, but not later than
December 31st of same
year, in any case.
Form A Certificate Within one month from
the date of appointment
of Statutory Central Audi-
tor (SCA) / Statutory Au-
ditor (SA).
As and When Date of detection of FMR - I Within three weeks from
Fraud the Reference Date.
(As and when the fraud is
detected)
Update Date/ Progress FMR III Immediate.
Date
(As and when any devel-
opment occurs in FMR-1
details)

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Indicative list of disclosures for NBFCs

Master Direction: Reserve Bank of India (Non-Banking Financial Company – Scale Based Regula-
tion) Directions, 2023
RBI/DoR/2023-24/106 DoR.FIN.REC.No.45/03.10.119/2023-24
Date of Issuance: October 19, 2023
(Updated as on October 10, 2024, Updated as on March 21, 2024, Updated as on November 10,
2023)
Section I
(Applicable for annual financial statements of NBFC-BL, NBFC-ML and NBFC-UL)
1. Exposure to real estate sector
2. Exposure to capital market
3. Sectoral exposure
4. Intra-group exposures
5. Unhedged foreign currency exposure
6. Related Party Disclosure
Summary information on complaints received by the NBFCs from customers and from the
7.
Offices of Ombudsman
8. Top five grounds of complaints received by the NBFCs from customers
9. Loans and advances availed by the NBFC inclusive of interest accrued thereon but not paid
Break-up of (1)(f ) above (Outstanding public deposits inclusive of interest accrued thereon
10.
but not paid)
Break-up of Loans and Advances including bills receivables [other than those included in (4)
11.
below]
Break up of Leased Assets and stock on hire and other assets counting towards asset financ-
12.
ing activities
13. Break-up of Investments
14. Borrower group-wise classification of assets financed as in (3) and (4) above
Investor group-wise classification of all investments (current and long term) in shares and
15.
securities (both quoted and unquoted)
16. Other information
17. Details of dividend declared during the financial year
18. Data on Pledged Securities
19. Loans to Directors, Senior Officers and Relatives of Directors
20. Provisions made as per these Directions without netting them from the income
21. Loans against security of single product - Gold Jewellery
Disclosures shall be made in the balance sheet relating to transactions undertaken in the cur-
22.
rency futures market, in accordance with the guidelines issued by SEBI.
23. Capital to Risk Assets Ratio (CRAR)
24. Exposure to real estate sector, both direct and indirect
25. Maturity pattern of assets and liabilities
Disclosures shall be made in the balance sheet regarding transactions undertaken in the cur-
26.
rency options market, in accordance with the guidelines issued by SEBI.

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Section I
(Applicable for annual financial statements of NBFC-BL, NBFC-ML and NBFC-UL)
A comparison between provisions required under IRACP and impairment allowances made
27.
under Ind AS 109 should be disclosed by NBFCs
28. Disclosure of Restructured Accounts
29. Public disclosure on liquidity risk
30. Credit Default Swaps - NBFCs as users
31. LCR Disclosure Standards

Section II
(Applicable for annual financial statements of NBFC-ML and NBFC-UL)
1. Corporate governance
2. Composition of the Board
3. Committees of the Board and their composition
4. General Body Meetings
5. Details of non-compliance with requirements of Companies Act, 2013
6. Details of penalties and strictures
7. Breach of covenant
8. Divergence in Asset Classification and Provisioning
9. Summary of Significant Accounting Policies
10. Capital
11. Investments
Derivatives
1. Forward Rate Agreement/Interest Rate Swap
12.
2. Exchange Traded Interest Rate (IR) Derivative
3. Disclosures on Risk Exposure in Derivatives
13. Assets Liability Management (Maturity pattern of certain items of Assets and Liabilities)
Exposure
1. Exposure to Real Estate Sector
2. Exposure to Capital Market
14.
3. Details of financing of parent company products
4. Details of Single Borrower Limit (SGL)/Group Borrower Limit (GBL) exceeded by the NBFC
5. Unsecured Advances
15. Registration obtained from other financial sector regulators
16. Disclosure of Penalties imposed by the Reserve Bank and other regulators
17. Related Party Transactions
18. Ratings assigned by Credit Rating Agencies and migration of ratings during the year
19. Remuneration of Directors
20. Management
21. Net Profit or Loss for the period, prior period items and changes in accounting policies
22. Revenue Recognition

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Section II
(Applicable for annual financial statements of NBFC-ML and NBFC-UL)
23. Consolidated Financial Statements (CFS)
24. Provisions and Contingencies
25. Draw Down from Reserves
26. Concentration of Deposits (for deposit taking NBFCs)
27. Concentration of Advances
28. Concentration of Exposures
29. Concentration of NPAs
30. Sector-wise NPAs
31. Movement of NPAs
32. Overseas Assets (for those with Joint Ventures and Subsidiaries abroad)
33. Off-balance Sheet SPVs sponsored
34. Disclosure of Customer Complaints

Section III
(Applicable for annual financial statements of non-deposit taking NBFC issuing Perpetual Debt
Instrument)
1. Amount of funds raised, outstanding, Percentage of the amount of PDI of the amount of its
Tier 1 capital etc.

Notes:
» Individual NBFCs may omit those line items/disclosures which are not applicable/not permitted or
with no exposure/no transaction both in the current year and previous year.
» NBFCs shall disclose comparative information in respect of the previous period for all amounts
reported in the current period’s financial statements. Further, NBFCs shall include comparative
information for narrative and descriptive information if it is relevant to understanding the current
period’s financial statements.
» It may be noted that disclosure requirements applicable to lower layers of NBFCs will be applicable
to NBFCs in higher layers.
» Only the disclosures specified in the master directions is included in the table above.

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 CA Kala Jayesh Umedmal
Candidate: WIRC of ICAI Election 2024
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