>>NON-BANKING FINANCE COS - RESIDUARY
The Reserve Bank of India, having considered it necessary in the public
interest and being satisfied that, for the purpose of enabling the Bank to
regulate the credit system to the advantage of the country, it is necessary to
amend the Residuary Non-Banking Companies (Reserve Bank) Directions, 1987,
hereby, in exercise of the powers conferred by Section 45J, 45K, 45L and 45JA
of the Reserve Bank of India Act, 1934 (2 of 1934) and all the powers enabling
it in this behalf, directs that the said Directions contained in Notification
No.DFC.55/DG(O)-87 dated the 15th May 1987 stand amended, with
immediate effect, as follows, namely :-
1. After paragraph 4 C, a new paragraph 4 D shall be inserted, -
"Mandatory
compliance with Prudential Norms
4 D A residuary
non-banking company shall not accept or renew deposits without complying with
all the requirements of Non-Banking Financial Companies Prudential Norms
(Reserve Bank) Directions, 1998 as contained in Notification No. DFC. 119
/DG(SPT)-98 dated January 31, 1998."
2. Paragraph 5 shall be substituted by the following, namely, -
"5. On and from July
1, 2000, the amount payable by way of interest, premium, bonus or other
advantage, by whatever name called, by a residuary non-banking company in
respect of deposits received from that date, shall not be less than the amount
calculated -
i.
at the rate of 6 per cent per annum (to be compounded annually) on
the amount deposited in lump sum or at monthly or longer intervals; and
ii.
at the rate of 4 per cent per annum (to be compounded annually) on
the amount deposited under daily deposit schemes."
Provided that where at the request of depositor, a residuary non-banking
company makes repayment of the deposit after the expiry of a period of one year
but before the expiry of the period for which the deposit had been accepted,
the amount payable by the company by way of interest, premium, bonus or other
advantage on such deposit shall be reduced by one percentage point from the
rate which the company would have ordinarily paid by way of interest, bonus,
premium or other advantage, had the deposit been accepted for the period for
which such deposit had run.
3. In paragraph 6, in sub-paragraph (1), the clause (b), the sub-clause
(i), shall be substituted by the following, namely, -
i.
not more than two percent of the aggregate amount of the
liabilities to the depositors shall be invested in any scheme/s of a Mutual
Fund which is governed by the Securities and Exchange Board of India (Mutual
Funds) Regulations, 1996 and the aggregate of such investment shall not exceed
ten per cent of the aggregate amount of liabilities to the depositors:
Provided that the
investment in any scheme/s of Unit Trust of India may be upto ten per cent of
the aggregate amount of liabilities to the depositors."
4. Schedule A appended to the said Directions stands substituted by
Return NBS 1A appended hereto.
Sd/-
( V.S.N. Murty )
Chief General Manager-In-Charge
Encls : NBS-1A