DIPP notifies 100 per cent FDI in more financial services

New Delhi: The Government of India has liberalised its foreign direct investment (FDI) policy for non-banking finance companies (NBFCs), by allowing 100 per cent FDI in other financial services carried out by NBFCs, which is expected to attract more foreign capital into the country. Other financial services include activities regulated by financial sector regulator like the Reserve Bank of India (RBI), Securities And Exchange Board Of India (SEBI), Insurance Regulatory and Development Authority (IRDA), Pension Fund Regulatory and Development Authority (PFRDA), National Housing Bank (NHB), or any other financial sector regulator as may be notified by the government in this regard, as stated by the Department Of Industrial Policy & Promotion (DIPP). The investment would, however, be subject to sector conditions such as minimum capitalisation norms specified by the regulator or government agency concerned. Under the current rules, 100 per cent FDI is allowed through automatic route for 18 specified NBFC activities, including merchant banking, stock broking, credit rating, housing finance and rural credit.

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