The Reserve Bank of India is requiring peer-to-peer lenders to have a net owned fund of at least 20 million rupees as part of the central bank's newly released guidelines for the platforms.
The central bank said Oct. 4 that all existing P2P players in the country will be required to obtain a certificate of registration to be classified as a nonbanking financial company.
The central bank will grant in-principle approval for 12 months to prospective P2Ps. Within that period, the company will need to put in place the technology platform, finalize all legal documentations required and report back to the central bank. The central bank will then give the P2P lender the required certificate of registration for the company to start operations.
Borrowers can take loans of up to 1,000,000 rupees in the aggregate across all P2P lenders. Lenders are limited to having an exposure of 50,000 rupees to the same borrower across all P2Ps. The maturity of the loans should not exceed 36 months.
The central bank had decided to regulate all P2P lenders as nonbanking financial companies in September.
As of Oct. 4, US$1 was equivalent to 65.03 Indian rupees.