Karnataka HC: State Has Fundamental Duty to Supply Drinking Water Fit for Human Consumption  ||  Raj. HC: Can’t Extend ‘Child Specific’ Safeguards to Victim to Attaining Majority During Trial  ||  Delhi High Court: Sadhguru Seeks Protection against Infringement of his Personality Rights  ||  Delhi High Court Tells Mohak Mangal to Remove Words like ‘Gunda Raj’ from Video against ANI  ||  Supreme Court Clarifies Observations on Mumbai Gateway of India Jetty Project  ||  Supreme Court Expresses Concern Over Delay by Delhi HC in Deciding Bail Plea  ||  SC Quashes Rape Case against Man Who Backed Out from Marriage  ||  Allahabad High Court Refers Question on High Court's Power to Quash FIR to 9-Judge Bench  ||  Delhi HC: Online Applications for ‘No Entry Permits’ Must be Scrutinised  ||  Delhi High Court: It is Not Necessary to Use Trademark in Physical Form    

RBI issues regulations under the amended Factoring Regulation Act, 2011 - (20 Jan 2022)

Banking

In the recent past, Central Government has amended the Factoring Regulation Act, 2011 widening the scope of companies that can undertake factoring business. The Act allows Trade Receivables Discounting System (TReDS) to file the particulars of assignment of receivables transactions with the Central Registry on behalf of the Factors for operational efficiency. Further, the Act empowers the Reserve Bank of India to make regulations prescribing the manner of grant of certificate of registration and for prescribing the manner of filing of assignment of receivables transactions by TReDS on behalf of the Factors.

The Factoring Regulation Act, 2011 was enacted for regulating the receivables to factors, making provision for registration for doing factoring business, and to determine the rights of the parties in a factoring contract. Now, in exercise of the powers conferred under the Act, the Bank has issued Registration of Factors (Reserve Bank) Regulations, 2022 and Registration of Assignment of Receivables (Reserve Bank) Regulations, 2022.

Under the provisions of the regulations, all existing non-deposit taking NBFC-Investment and Credit Companies (NBFC-ICCs) with asset size of Rs. 1,000 crore and above will be permitted to undertake factoring business subject to satisfaction of certain conditions. This will increase the number of NBFCs eligible to undertake factoring business significantly from 7 to 182. Other NBFC-ICCs can also undertake factoring business by registering as NBFC-Factor. Eligible companies may apply to the Reserve Bank for seeking registration under the Act. Further, in respect of trade receivables financed through a Trade Receivables Discounting System (TReDS), the particulars of assignment of receivables shall be filed with the Central Registry on behalf of the Factors by the TReDS concerned within 10 days.

Tags : REGULATION   FACTORING   ISSUANCE  

Share :        

Disclaimer | Copyright 2025 - All Rights Reserved