RBI tightens investment norms in NBFC from FATF non-compliant jurisdictions

  • Corporate Law
  • circular
  • financeseva

Circular No. DOR.CO.LIC.CC No.119/03.10.001/2020-21, Dated February 12, 2021 

 

In order to curb money laundering, the Reserve Bank of India has come up with a circular wherein it has been clarified that the investors from non-FATF compliant jurisdictions, would hold less than 20% of the voting power in non-banking finance companies (NBFCs).  

As a result, new investors from or through non-compliant FATF jurisdictions, whether in existing NBFCs or in companies seeking Certification of Registration (COR), should not be allowed to directly or indirectly acquire 'significant influence' in the investee.