Query Detail : SEBI Grade A Officer Phase I Paper 2 General Stream
In the video "Regulation of NBFCs by RBI", Sir has said that insurance companies can be categorised as NBFCs according to RBI definition. But in the next video "Live session- NBFCs" Mam says that insurance companies are not NBFCs. Which one is true?
Akshay, August 8th 2020,
SEBI Grade A Officer Phase I Paper 2 General Stream
In the Regulation of NBFCs video Sir has explained the definition of NBFC as per RBI which simply means that 50% of income or 50% of assets should be financial activity related. As per that an insurance is a type of NBFC; however it is not registered as an NBFC as there are separate law to govern the business of insurance (even though it is a financial activity). Later in the video Sir has told that insurance company is not registered as NBFC with RBI and same fact has been discussed by Mam in the live session - NBFCs.
So please do not confuse the two. Hope this clarifies your doubt