Setting up of the Working Group on the Issues and Concerns of the NBFC Sector in September 2010 is another instance of taking a pro-active stance in dealing with regulatory issues and concerns.
The overarching principles to the new regulatory framework revolve around some guiding principles: •  appreciating the contribution of the NBFC sector to the financial system and the economy and rationalising regulations to preserve the innovativeness of the sector  •  recognising the need to address systemic risk arising out of concentration and exposure of NBFCs to sensitive sectors  •  Recognising that the NBFCs have the ability to leverage on the RBI registration and therefore, rationalising the scope of regulation to address risks appropriately  •  conserving regulatory resources and directing them where required  •  dealing with regulatory arbitrage while not recommending completely bank-like policies and regulation for NBFCs and  •  giving adequate transition period to the industry so as to cause minimum dislocation to the sector.