Team of consulting auditors checking company financial report data (balance sheet, profit and loss account) on computer screen with business graphs, fintech | Photo credit: NicoElNino
NBFCs that could potentially be added to the list include Credila Financial Services (formerly promoted by HDFC Bank), Axis Finance promoted by Axis Bank, Kotak Mahindra Prime backed by Kotak Mahindra Bank, Can Fin Homes backed by Canara Bank, ICICI Home Finance promoted by ICICI Bank, Sundaram Finance, Hero Fincorp, Poonawalla Fincorp and Hinduja Leyland Finance. Barring ICICI Home and Can Fin Homes, all other NBFCs have assets under management (AUM) of over ₹40,000 crore as of September-end.
“Entities backed by big banks and promoters, which have gained scale and are becoming systemically important, may be added to the top tier list,” a source said.
Four-tier NBFCs
The RBI’s Scale-Based Regulatory Framework (SBR), which will come into force in October 2022, classifies NBFCs into four tiers: basic, middle, top and top. NBFCs in the middle and top tier are considered systemically significant. Ideally, the top tier is expected to be empty and will be filled only if the regulator believes that there is a substantial increase in the potential systemic risk of specific NBFCs in the top tier.
Top tier NBFCs are subject to stricter scrutiny by regulators, and unlisted top tier NBFCs must be listed within three years of classification. Currently, there are 15 major NBFCs in the upper tier category. These include LIC Housing Finance, Bajaj Finance, Shriram Finance, Tata Sons, Cholamandalam Investment and Finance, L&T Finance, M&M Finance, Aditya Birla Finance, Tata Capital, Piramal Finance, PNB Housing Finance, HDB Financial Services, Sammaan Capital, Muthoot Finance and Bajaj Housing Finance. Tata Sons has filed an application for deregistration as an upper tier NBFC with the RBI.”
“Reclassification of NBFCs from the middle tier to the upper tier becomes important to address systemic risks and continuously focus on maintaining financial stability. This is why the regulator reviews the classification on a periodic basis. We expect the regulator to focus on bank-backed NBFCs for inclusion in the revised list of upper tier NBFCs as interconnectedness and large asset size remain key drivers of systemic risk,” it said. Vivek Iyer, Partner and Financial Services Risk Leader, Grant Thornton Bharat.
Pratik Shah, partner and national financial services leader at EY India, said: “NBFCs that are likely to be closely evaluated are those with large, consolidated balance sheets, diversified financing profiles with greater dependence on market lending and significant exposure to large-scale retail or MSME lending.”
Changing technology landscape
However, he says that with the rapidly evolving technology landscape in the Indian BFSI sector – particularly the rise of platform-driven and digitally developed lending models – a complementary perspective has become increasingly relevant in assessing systemic importance.
These models have deepened the interconnections between banks and NBFC, not only through co-lending and securitization structures, but also through shared technology platforms, sourcing partnerships and outsourced service arrangements, allowing stress to spread more quickly between institutions. Furthermore, funding behavior during periods of tight liquidity, especially reliance on short-term market instruments, has emerged as an important indicator of systemic sensitivity.
Published on January 12, 2026
#RBIs #top #tier #list #include #NBFCs #promoted #banks #strong #promoters