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NBFC Collaboration, Partnerships, Co-Lending

Co-Lending Partnership & Revenue Model Designing

Finalizing the revenue share Model with the NBFC & Fintech Companies

Assistance in Opening the escrow Account of Fintech Company

End to End Assistance in preparing the Cross-Border Payments model

Compliance Management of Partner NBFC and Fintech Companies

FLDG Structure Designing

Legal Advisory for Fintech Business

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What is NBFC Collaboration/Association/Partnership/Co-Lending?

Collaboration/Association is a type of Association where the Fintech Companies do tie-ups with the existing NBFCs holding a valid certificate of Registrations. As per the data available in public domain, there is more than 8900 companies holding valid NBFC certificate of registration but merely around 950 NBFCs are running their business actively and has a capital size of more than 40 crores. The remaining NBFCs are only holding a Certificate and is able to meet the regulatory cap of INR 20 Million.

NBFC Collaboration/Association is relatively a new business term in which NBFC License holders enters into an Agreement with Fintech companies for sourcing of leads and funding for an agreed amount of fees for using the NBFC license as consideration. This consideration is decided by both the parties mutually. It can be at certain percentage of revenue or can be a fixed monthly amount. NBFC Collaboration is very successful if there are innovative loan products and quick disbursement of loan by use of the latest technology.

NBFC Collaboration Process with Fintech Company

There must be a Indian Entity registered with Fintech Business Model

Fintech Company will require to finalize the NBFC Company holding a valid Certificate of Registrations (CoR)

After Discussions and negotiations, the Companies enter into the Co-operation Agreement

NBFC is also required to sign a platform service agreement for the payment of technology services by the Fintech Company

NBFC Opens an Escrow Bank Account – (a Separate Escrow Account for Disbursement and Re-Payment)

Also there is a need to appoint a Chartered Accountant for the management of Fund and Operations of the Escrow Account

The Fintech Company can start its Disbursement and Re-Payment business activities with the Escrow Account

As soon as the business is started the Fintech Company has to ensure the regular Compliances (GST, TDS, CKYC, Credit Reporting, etc.) of applicable Indian laws

Minimum Required Technology with Fintech Company

Mobile App as per Indian Market

Loan origination system, Loan management system, Collection system.

Credit and underwriting software

Sufficient IT Security so that the personal information of the Borrowers should not be misused

Loan App should be able to integrate the various APIs but not limited to Aadhar, PAN, Driver license

Live Borrowers Profile Verification should be there

Income check process should be followed by bank statement analysis

The face of Borrowers must be matched to ID Submitted online

Online Verification of Employment Profile

Privacy norms as per the Law of India must be followed in case use of Social scoring technology

The server must be in India

India’s FDI Policy for Fintech Companies

Fintech Companies is eligible for 100% Foreign Direct Investment under Automatic Route

Currently, there is no such regulation providing the minimum capital requirements for an Entity to operate Fintech Business in India

What is the compliance requirement of the Fintech Company?

Fintech Company can give any loan or any guarantee through board resolution up to 60% of its paid-up capital and 100% of its free reserves and security premium, whichever is more

Under exception after Members, Approval can give loan up to 100% of Its Paid-up Capital

Fintech Company must pay GST on Loan Processing fees, In Normal practice Processing fees is inclusive of GST

Fintech Company should comply with ECB guidelines in case foreign fund has been raised as debt/Loan

What is the Compliance requirement for the NBFC?

Online Verification of ID, PAN Card, Aadhar of the borrowers

Store Data of the borrowers for 5 Years

Capture Live Picture of the borrowers

Pay E-Stamp Duty on Execution of the Loan Agreements

Report to Credit information Companies when loan inquiry, Disbursement, Delay or default

Comply with CKYC Norms as Prescribed the RBI

Comply with GST, TDS, Companies Act, and RBI Act

Appoint a CA for surprise check and Audit of the Fintech company to assess the business risk

Make Provision for NPA based on 45 days or 90 days Loan book performance norms

Our Process

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Why Caterpillar Financial Services?

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New Delhi, India

Caterpillar Global Consultancy Services

607, 6th Floor, Best Business Park

Netaji Subhash Palace, Delhi,

India, 110034

Our Services

Company Registeration in India

Foreign Subsidiary Registeration in India

NBFC Registeration in India

NBFC Takeover in India

NBFC Collaboration in India

Payment Gateway Business in India

Accounting Service in India

GST Registeration in India

Tax and Audit Service in India

Compliance Service in India

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