Master Direction- Reserve Bank of India (Non-Banking Financial Company – Scale Based Regulation) Directions, 2023.

Question 1

Non-Banking Financial Companies (NBFCs) shall comprise of four layers based on their …………………..

Answer 1

size, activity and perceived riskiness

Question 2

Government owned NBFCs shall be placed in the …………. Layer or ………… Layer, as the case may be. They will not be placed in the ………. Layer till further notice.

Answer 2

Base or Middle, Upper

Question 3

All NBFCs-D and non-deposit taking NBFCs of asset size of ………… crore and above shall have Prudential Framework for Resolution of Stressed Assets.

Answer 3

₹500 Crore

Question 4

A “……………………………..” is defined as one who does not provide necessary information required by a lender to assess its financial health even after two reminders; or denies access to securities etc. as per terms of sanction or does not comply with other terms of loan agreements within stipulated period; or is hostile/indifferent/in denial mode to negotiate with the NBFC on repayment issues; or plays for time by giving false impression that some solution is on horizon; or resorts to vexatious tactics such as litigation to thwart timely resolution of the interest of the lender/s.

Answer 4

Non-cooperative borrower

Question 5

The borrowers shall be given ………… notice to clarify their stand before their names are reported as non-cooperative borrowers

Answer 5

30 days’

Question 6

all NBFC-D and NBFC ND having asset size more than ……… shall have 100% LCR.

Answer 6

Rs. 5000 Crore

Question 7

NBFC with asset size of ₹100 crore and above while lending against the collateral of listed shares can lend up to ….. % of LTV of shares and any shortfall in LTV on account of movement of prices to be made good within …… Days

Answer 7

50%, 7 days

Question 8

LTV for loan against Gold Jewellery?

Answer 8

75%

Question 9

Verification of Gold is required if a borrower pledges gold jewellery of more than

Answer 9

20 Grams

Question 10

NBFCs financing against the collateral of gold must insist on a copy of the PAN Card of the borrower for all transaction above ………….

Answer 10

₹5 lakh.

Question 11

A public notice of at least ……… shall be given before effecting the sale of, or transfer of the ownership by sale of shares, or transfer of control, whether with or without sale of shares

Answer 11

30 days

Question 12

NBFCs shall give at least ……………. public notice prior to the date of closure of any of its branches/offices in, at least, one leading national newspaper and a leading local (covering the place of branch/ office) vernacular newspaper indicating therein the purpose and arrangements being made to service the depositors, etc.

Answer 12

three months

Question 13

Compensation for delay in release of movable/immovable property documents- documents submitted by the borrower shall be released within ………. or else ……….. per day fine shall be paid to the borrower

Answer 13

30 days or Rs. 5000

Question 14

Legal Entity Identifier for all borrowers availing loan facility above amount?

Answer 14

₹5 Crore

Question 15

………………………………… is the entity tasked to support the implementation and use of LEI.

Answer 15

Global Legal Entity Identifier Foundation (GLEIF)

Question 16

In India, LEI code may be obtained from…………………………………., a subsidiary of the Clearing Corporation of India Limited (CCIL), which has been recognised by the Bank as issuer of LEI under the Payment and Settlement Systems Act, 2007 and is accredited by the GLEIF.

Answer 16

Legal Entity Identifier India Ltd (LEIIL)

Question 17

All applicable NBFC having assets of ………… and above shall furnish information about downgrading/ upgrading of assigned rating of any financial product issued by them, within ………. days of such a change in rating, to RBI

Answer 17

₹100 crore, 15

Question 18

NBFCs with asset size of more than ₹5000 crore in categories - NBFC-ICC, NBFC-IFC, NBFC-MFI, NBFC-Factors and IDF-NBFC are required to appoint a

Answer 18

Chief Risk Officer (CRO)

Question 19

Once NBFC is classified as NBFC-UL - Within ………. months of being advised by the Reserve Bank regarding its inclusion in the NBFC-UL, the NBFC shall put in place a Board approved policy for adoption of the enhanced regulatory framework and chart out an implementation plan for adhering to the new set of regulations

Answer 19

3 months

Question 20

NBFC factor shall register with RBI under which Act.

Answer 20

section 5 of the Factoring Regulation Act, 2011

Question 21

The NBFC and their agents (Direct Sales Agents (DSA)/Direct Marketing Agents (DMA)/Recovery Agents) shall not call the borrower before ……….. and after ………….. for recovery of overdue loans or making false and misleading representations

Answer 21

8:00 a.m. and 7:00 p.m.

Question 22

what shall be the maturity of Private placement of Non-Convertible Debentures (NCDs)

Answer 22

Not less than 12 months

Question 23

what shall be the maximum no of investors and minimum subscription for Private placement of Non-Convertible Debentures (NCDs)

Answer 23

200 subscribers with max subscriptions less than 1 Cr and no limit on subscribers with subscriptions more than 1 Cr. Minimum Subscription amount is Rs 20,000

Question 24

Exposure to capital market by NBFC-HFC shall be

Answer 24

should not exceed 40 per cent of its net worth

Question 25

what is the Brokerage Limit for HFCs?

Answer 25

5% of total transactions (both sales and purchases). However, 5% would not be applicable to HFC’s whose total transactions in a year do not exceed ₹20 crore and to those who deals through SPD.

Question 26

Maintenance of a minimum percentage of liquid assets by HFC?

Answer 26

not less than 6.5% in unencumbered approved securities and 13% (which includes the earlier 6.5%) in Term Deposit or CD of any SCB. The percentage is calculated on the public deposits O/s close of the business on Last working Day of the second preceeding quarter. Now have to achieve 15 (10) in phased manner upto July 2025.

Question 27

Ceiling on quantum of Deposit accepted by HFC?

Answer 27

3 times of NOF

Question 28

Tenure of Deposit accepted from Public by HFC?

Answer 28

12 to 120 months

Question 29

Ceiling on the rate of interest & brokerage to be paid for collecting deposits by HFC?

Answer 29

Public Deposit – not more than 12.5%, Brokerage – not exceeding 2% of deposit collected and expenses by way of reimbursements to brokers - not exceeding 0.5% of deposit collected.

Question 30

Tenure of Deposit accepted from NRI by HFC?

Answer 30

Firstly the deposit will be accepted on non-repatriable basis and for 1 to 3 years

Question 31

NHB who intends to accept deposit without advertising shall give a statement within …. months to NHB containing all the information which is ideally included in an advertisement.

Answer 31

6 months

Question 32

HFC can grant Demand Loan upto ……. of Deposits, if the deposits have completed 3 months tenure and charge above the contracted rate of interest for the deposit

Answer 32

75%, 2%

Question 33

What is the amount of Tiny Deposit?

Answer 33

₹ 10,000/-

Question 34

When shall be a prospective customer be called and the frequency of calling?

Answer 34

Telephonic contact must normally be between 09:30 hours and 19:00 hours. Prospects/ Customers who have expressed their lack of interest for the offering should not be called for the next 3 months with the same offer.

Question 35

Notice Boards on HFC premises: The minimum size of the board may be ………….. as the board of such a size would facilitate comfortable viewing from a distance of ………………

Answer 35

2 feet by 2 feet, 3 to 5 meters