Prelims 2026 · Economy · Question 99
Consider the following statements about the Non-Banking Financial Companies (NBFCs) in India :
- NBFCs cannot accept demand deposits.
- All the NBFCs operating in India have to be registered with the RBI.
- NBFCs form part of the payment and settlement system and can issue cheque drawn on itself.
- Deposit insurance facility of Deposit Insurance and Credit Guarantee Corporation (DICGC) is not available to the depositors of deposit taking NBFCs.
Which of the statements given above is/are correct ?
Answer
1 and 4
1 is correct: NBFCs do not accept demand deposits. 2 is not correct as an absolute statement; registration is not literally universal across every entity in the wider NBFC space because exemptions/other regulatory carve-outs have existed. 3 is incorrect: NBFCs are not part of the payment and settlement system in the same way banks are, and they cannot issue cheques drawn on themselves. 4 is correct: DICGC deposit insurance is not available to depositors of deposit-taking NBFCs. Therefore the correct set is 1 and 4 only.