NBFC meaning, the 50-50 test and registration
The list of NBFCs in India starts with a definition, because the label covers many different businesses. The Reserve Bank of India describes a non-banking financial company as a firm registered under the Companies Act whose main activity is lending, investing in securities, leasing or hire purchase. Companies whose principal business is agriculture, industry, trade in goods or services, or real estate are left out of the definition.
A practical test applies. Financial assets must be more than half of total assets, and income from financial assets must be more than half of gross income. A company that meets both tests and wants to do this business needs a Certificate of Registration from the RBI and net owned funds of Rs 10 crore.
An NBFC is not a bank. It cannot accept demand deposits, cannot issue cheques drawn on itself, and its depositors are not covered by DICGC deposit insurance. The RBI has issued no new deposit-taking licences since 1997. These limits explain why a borrower or an investor must look at an NBFC differently from a bank branch.
NBFC categories recognised by the RBI
The RBI sorts NBFCs by activity. The categories named in its FAQ are the following.
- Investment and Credit Company, the general lending category
- Housing Finance Company, with at least 60 per cent of assets in housing finance
- Infrastructure Finance Company, with at least 75 per cent of assets in infrastructure lending
- Infrastructure Debt Fund NBFC
- Core Investment Company, for groups with assets of Rs 100 crore or more
- NBFC-MFI, with at least 60 per cent of assets in microfinance loans to households earning up to Rs 3,00,000
- NBFC-Factor
- Mortgage Guarantee Company
- Standalone Primary Dealer
- Non-Operative Financial Holding Company
- NBFC-Account Aggregator
- NBFC-P2P, for peer-to-peer lending platforms
Each category carries its own rules. A housing finance company lends against homes, an NBFC-MFI lends small amounts to low-income households, and an account aggregator moves financial data with consent rather than lending at all. The category printed on a company’s registration certificate tells a customer what the firm is allowed to do.
None of these categories is described as Islamic or Sharia-based. An NBFC that follows Islamic principles would still be registered in one of them and would answer to the same regulator.
The four layers of scale based regulation
Besides category, the RBI groups NBFCs into four layers under its scale based regulation framework: Base, Middle, Upper and Top. The layer decides how strict the rules are. The framework is governed by the RBI NBFC Registration, Exemptions and Framework for Scale Based Regulation Directions, 2025.
Group exposure limits show the difference in practice. A Middle Layer NBFC is held to 40 per cent of Tier-I capital for exposure to a group, and an Upper Layer NBFC to 25 per cent of eligible capital. For the rupee thresholds that separate the Base and Middle layers, check the RBI’s current scale-based regulation framework.
An Upper Layer company is the group the RBI singles out in the framework, and a roll of such companies is published, which makes it the closest thing to a formal named list of large NBFCs. Because the exposure limits differ between layers, the layer of a lender is a useful fact to ask about.
List of NBFCs in India: the 17 in the Upper Layer for 2026-27
An RBI release of 6 August 2026 gave the latest Upper Layer list, for 2026-27 and based on financials at 31 March 2026. It names 17 companies.
- REC
- Power Finance Corporation
- Indian Railway Finance Corporation
- Bajaj Finance
- Shriram Finance
- LIC Housing Finance
- Cholamandalam Investment and Finance
- Tata Capital
- Tata Sons Private Limited
- Muthoot Finance
- Aditya Birla Capital
- HUDCO
- Mahindra and Mahindra Financial Services
- L&T Finance
- Bajaj Housing Finance
- HDB Financial Services
- Piramal Finance
Tata Sons is a Core Investment Company, and its inclusion is stated to be without prejudice to its pending application to de-register. PNB Housing Finance and Sammaan Capital continue in the Upper Layer for at least five years from their earlier classification, so they sit alongside the 17 even though they are not counted among the new names.
No list was issued for 2025-26 because of the review of that year. The previous list dated 14 September 2023 named 15 NBFCs, which shows how the roll changes as companies grow or are reclassified.
How the Upper Layer test has changed
An RBI amendment issued on 24 June 2026 classes NBFCs with assets of Rs 1,00,000 crore or more, as shown in the latest audited balance sheet, as Upper Layer. The classification is reviewed every three years. The August 2026 list followed that amendment, so both dates matter when checking a company’s layer.
Since the wording of the August release also refers to revised criteria, the safest approach is to quote the two dates and not to explain how they fit together beyond that. A company’s own annual report or an RBI notice is the place to confirm whether it is currently in the Upper Layer.
For the total number of registered NBFCs across all layers, check the RBI’s own list. Anyone who needs a full register should consult the RBI’s own list of registered companies.
Lending services these companies provide
The Upper Layer names show the range of work. LIC Housing Finance, Bajaj Housing Finance and HUDCO carry housing in their names, and the RBI category of Housing Finance Company requires at least 60 per cent of assets in housing finance, so a customer can confirm the category on the registration certificate. Tata Sons is a Core Investment Company, a category for groups holding assets of Rs 100 crore or more. For the other names, the nature of the business should be checked in each company’s own disclosures and not assumed from its brand.
At the small end, NBFC-MFIs lend to households with income up to Rs 3,00,000, and NBFC-P2P platforms connect lenders and borrowers. Under the RBI’s 2025 peer-to-peer directions, a lender’s total exposure across all platforms is capped at Rs 50 lakh, a borrower’s total across platforms at Rs 10 lakh, and the maximum maturity is 36 months. These platforms may not offer guarantees, give secured loans or promote loans as investments with assured returns.
LenDenClub shows an NBFC-P2P badge on its site and states a minimum lending amount of Rs 10,000. Faircent was described in 2018 as the first platform to receive an RBI NBFC-P2P certificate. Both are examples of the category, not recommendations.
Checking an NBFC and protecting yourself as a borrower
Before dealing with any NBFC, ask for its Certificate of Registration number and category, and verify them on the RBI’s website. Check that the lender is not a name used by an unregistered firm. The RBI Sachet portal exists to report unauthorised deposit-taking, which matters because NBFCs may not take deposits unless specifically permitted.
Borrowers are protected by conduct directions. Rates must be disclosed in the application and the sanction letter as annualised rates, and the Key Facts Statement must show an annual percentage rate including all charges. Any penal charge has to be reasonable, disclosed in advance and never compounded. Property papers must be released within 30 days of full repayment, and pledged gold or silver within seven working days.
Complaints against banks and NBFCs can go to the RBI Integrated Ombudsman Scheme. For online loan apps, the RBI has said regulated entities must report their digital lending apps, and a public list of reported apps was announced so borrowers can check the link to a regulated lender. The list does not mean the RBI endorses an app.
The cost side deserves a worked example. The RBI directions illustrate a Key Facts Statement for a Rs 20,000 loan at 15 per cent, repaid in 24 instalments of Rs 970. Total interest comes to Rs 3,274, and the annual percentage rate is 17.07 per cent. The gap between 15 and 17.07 shows why the all-in rate matters more than the headline rate.
A change in rate applies only from the date it is notified and not backwards, and a charge missing from the statement cannot be levied without the borrower’s explicit consent. Microfinance loans carry no prepayment charge, so a household borrower can close early without a penalty.
Readers looking for interest-free options should know that the Islamic-style bodies in India are mostly co-operative societies, not RBI-registered NBFCs. A name on this roll does not make a company Sharia compliant, and compliance is for a qualified scholar to judge.