I. Introduction
The RBI, through its RBI (Non-Banking Financial Companies- Registration, Exemptions and Framework for Scale Based Regulation) Amendment Directions, 2026 (“Amendment Directions”), has introduced one of the most significant recalibrations to the NBFC registration framework in recent years. While the regulatory narrative surrounding the amendments has largely focused on “relaxation” and “ease of doing business”, the framework, when examined closely, reflects a far more nuanced regulatory objective.
On the surface, RBI has attempted to reduce the compliance burden for genuinely passive and low-risk entities that neither access public funds nor interact with customers. However, the RBI has simultaneously tightened the interpretation of what constitutes “public funds”, widened the scope of “customer interface”, introduced group-level aggregation principles, and reinforced a substance-over-form supervisory philosophy.
