The Reserve Bank of India granted "self-regulatory organisation" status to the Finance Industry Development Council (FIDC) on Friday to help ensure regulatory compliance in the non-banking lending sector.
Self-regulatory organisations (SROs) are expected to help develop industry standards and best practices, and ensure that members adhere to these. They are also expected to ally with the RBI to ensure better compliance with regulatory guidelines and for the detection of early warning signals, among other things.
Earlier in August, Moneycontrol had reported that FIDC had received the in-principle approval from the central bank for a SRO licence.
Last year, the RBI released a framework for the recognition of SROs in the financial markets space, and granted SRO status to the Fintech Association For Consumer Empowerment in the financial technology (fintech) sector.
On Friday, the central bank said it received three applications to be recognised as self-regulatory organisations in the NBFC space, including the FIDC.
The FIDC is a representative body of non-banking financial companies (NBFC) registered with the RBI. Almost all the leading NBFCs across the country are members of this organisation, according to its website.
"The remaining two applications were not considered since they were incomplete as on the last date of submission of application," RBI said, without naming them.
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