RBI keeps Tata Sons in NBFC upper layer list, maintains status quo on listing

Published 6 August 2026 · local

Mumbai: The Reserve Bank of India (RBI) on Thursday retained Tata Sons Pvt. Ltd in the upper layer of non-banking financial companies (NBFCs-UL) for FY27

Mumbai: The Reserve Bank of India (RBI) on Thursday retained Tata Sons Pvt. Ltd in the upper layer of non-banking financial companies (NBFCs-UL) for FY27, leaving the Tata Group holding company subject to enhanced regulatory requirements while the central bank decides on the company’s application to surrender its core investment company (CIC) registration. A media release by the RBI showed that Tata Sons continues to feature as a CIC. The statement clarified that the company’s inclusion is without prejudice to the outcome of its deregistration application, which remains under examination, same as what it had said in the last list in January 2025. The decision means that Tata Sons' ability to avoid the proposed listing will depend on whether the RBI approves its request to surrender its CIC registration. Under the revised framework, an NBFC classified in the upper layer remains subject to the enhanced regulatory regime for at least five years, even if it no longer meets the eligibility criteria in subsequent years. The RBI also said upper-layer NBFCs may move out of the enhanced regulatory framework before the end of the five-year period if the move is part of a voluntary strategic readjustment under a board-approved policy. “This stipulation shall not apply if the scaling down of operations is on account of adverse situations specific to the NBFC and its deteriorating financial conditions,” the central bank said.

“This essentially maintains the status quo for Tata Sons. Since its application for deregistration as an NBFC is still under examination, the company will continue to be treated as an upper layer NBFC and comply with the applicable regulatory requirements until the RBI takes a final decision,” said Abizer Diwanji, founder at NeoStrat Advisors. Diwanji said the five-year continuity provision in the revised framework applies to NBFCs that no longer meet the asset-based criteria, whereas Tata Sons is a separate case because it is seeking deregistration. “The intent behind the RBI’s revised framework was to ensure that entities such as Tata Sons, which voluntarily seek de-registration as a CIC, are not required to continue complying with the enhanced upper layer regulatory requirements for the next five years,” said Prakash Agarwal, partner at Gefion Capital. “The deregistration process and the upper layer classification are parallel issues. Once the RBI approves Tata Sons’ deregistration application, the five-year continuity requirement should, in my view, no longer apply to the company,” Agarwal said. A person familiar with the matter had told Mint on 5 August that the RBI could grant relief from the listing requirement in exceptional cases. Earlier on the same day, Mint reported that RBI governor Sanjay Malhotra had indicated Tata Sons could continue to feature on the revised upper-layer list and that the central bank's shift to a principle-based framework had made it easier to determine which NBFCs qualify for the upper layer without relying solely on a published list.