RBI Circular

RBI Mandates the PRAVAAH for Business Regulatory Approvals

The Reserve Bank of India, on April 11, 2025, posted a Press Release No. 2025-2026/96 on their website that mandated the use of the Pravaah Portal for all business regulatory compliances, effective May 1, 2025. This new reform aims to digitalize and centralize the application approval process, thereby improving the overall efficiency and transparency of the process.

This process enables businesses to track the status of their application through the Pravaah Portal, which further helps them achieve great targets whilst reducing the bureaucratic delays as against the offline filing system.

This blog will focus on the importance, legal background, eligibility criteria, positive impact of Pravaah on individuals and corporations, procedure for application, types of applications, and documentation requirements.

What is the Pravaah Portal?

Reserve Bank of India (RBI) launched the Platform for Regulatory Application, Validation, and Authorization (Pravaah Portal), a one-stop-shop online portal to digitalize and simplify various regulatory compliance approvals and authorizations on May 28, 2024.

Importance of the Pravaah Portal

All businesses and entrepreneurs must understand the importance of the Pravaah Portal to obtain benefits and establish a strong business presence through a fast and easy process in no time. The importance of the Pravaah Portal is as follows:

1. All-In-One Service Portal

Pravaah portal is a one-stop-shop online service platform for entrepreneurs and legal entities to obtain various business regulatory approvals and licenses from the Reserve Bank of India (RBI). Pravaah currently has over 60 applications for various compliance requirements.

2. Full Digital Service

The Pravaah process saves time and money in terms of cost-efficiency through the digitalization of the entire regulatory compliance process. Applicants don’t need to stand in long queues anymore. They can use the portal to submit and monitor their application with a click of their cell phones.

3. Transparent

Pravaah helps individuals and business applicants track and monitor their application process in real time, which saves both time and money as opposed to the traditional in-person application filing system, which requires applicants to visit the relevant compliance authority in person, thereby increasing the cost as well as the time to get approvals.

4. Big Scope

Pravaah is an all-in-one service that provides over 60 applications for various business compliance requirement approvals. Some license approvals include regulatory approvals under the Foreign Exchange Management Act (FEMA), the opening of special rupee vostro account, dividend declaration, and non-banking finance company registration (NBFC).

Legal Background of the Pravaah Portal

There’s no independent legislation that governs the functionality of the Pravaah Portal. However, the Reserve Bank of India (RBI) governs and administers the regulatory framework of the Pravaah Portal under the following laws:

Reserve Bank of India, 1934:

1. This act establishes the Reserve Bank of India (RBI)’s role as the central bank authority to control the entire governance of the Pravaah portal.
2. The act enables the Reserve Bank of India (RBI) to regulate banking, monetary policy, and other finance regulatory compliance approvals through the Pravaah portal.
3. This act enables the RBI to approve non-banking financial companies (NBFCs) related business compliances through the Pravaah Portal.

The Banking Regulations Act, 1949:

This legislation applies to all banking facilities and cooperative banks that are based out of India.

Foreign Exchange Management Act (FEMA), 1999:

This act applies to applications concerning foreign exchange transactions such as foreign direct investments (FDI), external commercial borrowings (ECB), branch office (BO), and liaison office (LO) approvals. 

The Prevention of Money Laundering (PMLA) Act. 2002:

This legislation applies to approvals concerning mutual funds, insurance, non-banking financial companies (NBFCs), housing finance companies (HFCs), stock exchange brokers, and banks.

The Payment and Settlement Systems Act, 2007:

This legislation applies to approvals concerning licenses for companies that want to provide payment services as a payment aggregator (PA), Payment aggregator cross-border (PA-CB), electronic money transfer, such as national electronic funds transfer (NEFT), real-time gross settlement (RTGS), immediate payment service (IMPS), and other relevant payment services.

Eligibility Criteria for Pravaah Portal

Individuals and legal entities who desire to obtain various business compliance approvals can use the Pravaah Portal. The eligibility criteria are as follows:

1. Indian Individuals: Indian natural persons who desire to obtain regulatory approvals under the Foreign Exchange Management Act of 1999 are eligible to register with the Pravaah Portal.
2. Indian Legal Entities: Indian legal entities such as banks, cooperative banks, authorized banks (AB), non-banking financial companies (NBFCs), digital payment operators, fintech, reg tech, wealth tech, legal tech, and other relevant companies are eligible to register with the Pravaah Portal. 
3. Foreign Individual and Legal Entities: Foreign investors and companies looking to establish a liaison, branch, or project office, acquire properties, or invest in India are eligible to register with the Pravaah Portal.

Statistics of the Pravaah Portal

The Reserve Bank of India launched the Pravaah portal on May 28, 2024, and since it has:

• Processed 3000+ applications
• Uploaded 108 application forms for various business regulatory approvals

Impact of Pravaah Portal on Individuals and Businesses

The impact of the Reserve Bank of India (RBI)’s mandate on the use of the Pravaah Portal for regulatory approvals is as follows:

1. Uniform Applications

The Pravaah portal standardizes the approval process for all applicants. It provides consistent standard application forms, which help individuals and entities obtain regulatory approvals through an easy and smooth process, thereby eliminating unnecessary hurdles and restraints.

2. Principal Portal

The Pravaah Portal acts as a central hub to obtain necessary regulatory approvals for individuals, entities, and authorized banks, thereby removing hefty processes of acquiring approvals through individual departments and institutions.  

3. Built-in Validation

The Pravaah Portal has a built-in quality check system that enables applicants to avoid preliminary errors, thereby reducing unnecessary delays in the approval process.

4. Scope for Fintech Growth

The digital filing of all types of business regulatory approval forms can help increase the growth of fintech companies in India. Faster and transparent regulatory approvals can help fintech businesses avoid any bureaucratic delays.

5. Documentation Process

Businesses can use the Pravaah Portal as a record-keeping tool, which could help them provide accurate records concerning license requirements and approvals in the event of any audits or legal disputes.

6. Risk Management

Individuals and businesses can track their application progress in real-time, which helps them avoid important deadlines for business compliance.

7. Single Window System

Individuals and businesses that are seeking to obtain multiple approvals for various regulatory compliances can use the same registration ID to register for multiple applications through the Pravaah portal, which further streamlines the submission and monitoring process of all applications, thereby increasing time and cost efficiency for the end users.

8. Promotes Digitalization

The integrated digital interface helps businesses and individuals obtain various licenses and permits without any in-person visits and manual paperwork, which helps them reduce potential delays, improve transparency through real-time tracking, and provide specific timeline schedules for application approval.

9. Ease of Doing Business

The Pravaah Portal helps business entities like fintech and non-banking financial companies (NBFCs) decrease their administrative burdens and bureaucratic delays in obtaining relevant licenses, thereby promoting and enhancing business simplicity.

10. Technological Integration

The use of technology-driven solutions such as AI and machine learning remarkably improves the accuracy and efficiency of the application process, thereby eliminating the risk of data counterfeiting and mistakes.  

11. Quick Feedback

The Reserve Bank of India (RBI) provides quick feedback responses through the portal, which speeds up the approval process, thereby eliminating burdensome processes and improving the overall efficiency of the approval process.  

12. General Purpose Application

The Pravaah Portal has an all-purpose application form that enables applicants to submit application requests that don’t fit into any of the existing application forms, thereby helping the Reserve Bank of India (RBI) to improve and expand the portal over time.

Procedure for Filing an Application Through the Pravaah Portal

All applicants must understand the procedure for applying through the Pravaah Portal. Applicants can take assistance from the user manual to get help navigating the application process to obtain various regulatory approvals. The step-by-step procedure is as follows:

Step 1: The applicant must access the Pravaah Portal.

Step 2: The applicant must log in as a new user or an existing user.

Step 3: The applicant must select the relevant application (individual or entity) and fill in the necessary details to obtain successful one-time password (OTP) authentication.

Step 4: The applicant must select and submit the relevant application with the necessary documentation.

Step 5: The applicant must track the application status by using the unique application ID. The ID helps applicants to monitor the application in real-time. It also provides specific time frames for application approvals.

Step 6: The Reserve Bank of India (RBI) informs its decision to the applicant through the Pravaah Portal.

The Reserve Bank of India may ask applicants to submit additional documents. The applicants can view the feedback under the “RBI Response Documents” section.

Documentation Requirements

All applications have specific documentation requirements. However, the most common documents are as follows:

• A copy of the passport for foreign individuals and entities
• A copy of the visa for foreign individuals and entities
• Unique Identification Number (Aadhaar Card)
• Permanent Account Number (PAN) Identification Number
• Any other name and address identification, if applicable
• Details of local representatives for foreign individuals and entities
• Goods and Service Tax (GST) Number
• A copy of the company registration certificate for corporate applicants

Types of Applications on the Pravaah Portal

The Reserve Bank of India currently has 108 forms available for various regulatory compliance approvals on the Pravaah Portal.

Some important applications are as follows:

1. Applications for non-banking financial companies (NBFCs).  
2. Application for inclusion of Universal Banks or Small Finance Banks or Payments Banks or Foreign Banks in the Second Schedule of the RBI Act of 1934
3. Foreign Investment in Non-Debt Instruments
4. Regulatory Approvals about Liaison, Branch, or Project Office in India
5. Application for recognition as a Self-Regulatory Organization for the FinTech sector (SRO-FT).
6. Applications to Operate as Payment Aggregator (PA) or Payment Aggregator Cross Border (PA-CB).
7. Application to Start a Banking Business in India.
8. Application for Foreign Banks to Establish a Business Establishment in India.
9. Application for Membership in Negotiated Dealing System- Order Matching (NDS-OM).
10. Application for Opening of Special Rupee Vostro Account.
11. Application for Regulatory Approval License Under Foreign Exchange Management Act (FEMA)- Five R and Ten R.
12. Application for Acquisition and Sale of Immovable Property Under the Foreign Exchange Department (FED).
13. Application for Approval of Bank Guarantees Over General Limit for Authorized Banks (AD).
14. Application for External Commercial Banking (ECB) Proposals.
15. Application for Primary Dealer License.
16. Applications Relating to Change in Shareholders and Management of Housing Finance Company (HFC).
17. Applications Under the Payment and Settlement Systems (PSS) Act.
18. Applications for Cooperative Bank Approvals.
19. Applications for the Renewal of Ongoing Approvals.
20. Applications for Foreign Direct Investments in India. 
21. Application to Obtain Insurance in Foreign Countries.

Take Away

The introduction of the Reserve Bank of India (RBI)’s mandate to obtain various regulatory licenses through the Pravaah Portal is an instrumental step towards a paperless world of business compliance management. The portal aims to create a one-stop resource mechanism that promotes efficiency and transparency in regulatory compliance reporting.

The Reserve Bank of India (RBI)’s integration of various regulatory compliance under one system will benefit entities such as foreign companies, foreign direct investments, online payment systems, banking, and non-banking financial companies for most of India. Technological integration of the regulatory approval process will further help implement an artificial intelligence (AI) resolution system based on data analytics and customer behavioural patterns.

To get expert assistance in registering through the Pravaah Portal and meeting compliance requirements, visit https://enterslice.com/.

Frequently Asked Questions