New Delhi, Aug 6 (IANS) The Reserve Bank of India on Thursday included Tata Sons in its list of 17 “upper layer” non-banking financial companies (NBFCs), a category that faces stricter regulatory requirements, which also require public listing.
The RBI said the classification would not affect Tata Sons’ pending application to give up its NBFC registration.
Tata Sons, the holding company of 31 Tata Group firms such as Tata Motors, Tata Steel, and TCS, is under pressure to go public from its second-largest shareholder, the Shapoorji Pallonji (SP) Group, due to internal differences with the top management. Tata Sons has remained unlisted as it considers itself a charitable trust.
Upper-layer NBFCs are the RBI’s designation for large and systemically important non-bank lenders, which are subject to more stringent regulatory norms.
Under the revised RBI norms that came into effect in June, NBFCs with assets of more than Rs 1 lakh crore are placed in the ‘upper layer’. These entities are subject to stricter regulatory oversight and are required to list on the stock exchanges within three years.
The company has applied to surrender its registration as a Core Investment Company (CIC), and the application is still under consideration by the central bank, according to an RBI press release.
Whether Tata Sons will eventually have to go public depends on the RBI’s decision on this application. Tata Sons is registered as a CIC under the NBFC framework.
A CIC is an NBFC whose main business is investing in companies within its own group. Under RBI rules, at least 90 per cent of its net assets must be invested in equity shares, preference shares, bonds, debentures, debt, or loans of group companies.
The RBI has also listed Tata Capital as an upper layer NBFC along with government-owned REC, Power Finance, Indian Railway Finance Corporation Limited — three companies that have been described as Infrastructure Finance Companies in the upper layer list for 2026-27.
Shriram Finance Limited, Bajaj Finance, and Muthoot Finance Limited have been termed as deposit-taking NBFCs in the upper layer list. Besides, Aditya Birla Capital Limited, L&T Finance Limited, Mahindra & Mahindra Financial Services Limited, and Piramal Finance Limited also figure in the list of 17 companies.
“In terms of the framework, once an NBFC is classified as NBFC-UL, it shall be subject to enhanced regulatory requirements, at least for a period of five years from its classification in the layer, even in case it does not meet the criteria in the subsequent year/s. Accordingly, the following NBFCs which were identified as NBFC-UL in previous exercises but do not meet the criteria in the current exercise, would continue in NBFC-UL and be subject to enhanced regulatory requirements of NBFC-UL,” the RBI statement said.
–IANS
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