Priya Sharma (Company Secretary & Student.MBA) (998 Points)
05 January 2010What is a Non Banking Financial Company??Please explain in a elaborative manner.
Regards
Priya Sharma
CA Dhiraj Ramchandani
(CA, M. com)
(10823 Points)
Replied 05 January 2010
NBFC means Non-banking financial company. A non-banking financial company (NBFC) is a company registered under the Companies Act, 1956 of India and is engaged in the business of loans and advances, acquisition of shares/stock/bonds/debentures/securities issued by government or local authority or other securities of like marketable nature, leasing, hire-purchase, insurance business, chit business, but does not include any institution whose principal business is that of agriculture activity, industrial activity, sale/purchase/construction of immovable property.
CA Dhiraj Ramchandani
(CA, M. com)
(10823 Points)
Replied 05 January 2010
DIFFERENCE BETWEEN BANK AND NBFC :
NBFCs are doing functions akin to that of banks; however there are a few differences:
(i) an NBFC cannot accept demand deposits;
(ii) an NBFC is not a part of the payment and settlement system and as such an NBFC cannot issue cheque drawn on itself; and
(iii) deposit insurance facility of Deposit Insurance and Credit Guarantee Corporation is not available for NBFC depositors unlike in case of banks.
akshaya dhaundiyal
(trainee )
(25 Points)
Replied 22 June 2012
que. there is a foreign company investing in indian company and this indian company holds shares in different companies (down stream investment) . will this be aNBFC.?? if yes /no plz the source.
CAclubindia
