Instances have been brought to the notice that some of NBFCs are changing their name, more particularly to add InfoTech tag with a view to taking the advantage of the capital market sentiments, which may jeopardize the interest of the depositors and the investors. The name change may result in the principal business of the process Change in Name of NBFC thereby it can affect its eligibility for grant and holding of Certificate of Registration.
With the view to protect the interest of the Public, the NBFC intending to change the existing name need to obtain the prior permission of RBI before the compliance of ROC for name change process. The violation of the directions given by RBI[1] would attract serious action against the company including cancellation of COR (if already granted).
An advertisement should be published by the company to inform all the stakeholders in the English newspaper and one in vernacular language newspaper where the registered office of the company is situated.
Conclusion-The change of name of NBFC required prior approval of RBI and necessary compliances are required to be followed prior to change the name. Further, the change in name of nbfc should not affect the investors and shareholders.
Also, Read: NBFC: Change NBFC Name in India.
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