November 10, 2014

Dear Sirs,

Review of the Non-Banking Financial Company – Factors (Reserve Bank) Directions, 2012

Please refer to DNBS (PD) CC. No. 297/Factor/22.10.91/ 2012-13, dated July 23, 2012 in terms of which an NBFC-Factor shall ensure that its financial assets in the factoring business constitute at least 75 per cent of its total assets and its income derived from factoring business is not less than 75 per cent of its gross income.

2. Taking into consideration the representation received from the industry and also to encourage the factoring sector in India, it has been decided that an NBFC for registering as NBFC-Factor shall ensure that its financial assets in the factoring business constitute at least 50 per cent of its total assets and its income derived from factoring business is not less than 50 per cent of its gross income.

Yours faithfully,

(A.Mangalagiri)
General Manager