RBI upper layer NBFC directions: Will Tata Sons have to list?

The Reserve Bank of India on Wednesday, June 24, 2026, issued final guidelines for the classification of non-banking finance companies in the upper layer (NBFC-UL).  One entity closely watching the developments will be Tata Sons. There has been a lot of debate in favour of and against its listing.

The upper layer comprises of those NBFCs which are specifically identified annually as warranting enhanced regulatory requirement based on the criteria provided in the directions. These are considered among the systematically significant institutions and Reserve Bank rules mandate that such entities identified as NBFC-UL must list on the stock exchanges within three years.

Tata Sons was designated as an upper layer NBFC - CIC (core investment company) back in September 2022. So, it's deadline to list has long passed. Tata Sons itself approached RBI in 2024 seeking deregistearion as an NBFC, in a bid to avoid being listed.

MUST READ: Which NBFCs are classified in the upper layer? Here what RBI's final norms say

There have been lot of arguments on whether it should be listed or remain private. The Shapoorji Pallonji Group (SP Group), which holds some 18 per cent stake in Tata Sons, has for long called for a listing, a move it says will reinforce corporate governance, deepen transparency and accountability.

More importantly, though, the SP Group also has lot debts. A listing of Tata Sons will allow it to sell its stake and those funds could then be used to pare its debt.

However, some former officials of the Tata Group have argued that against any listing.

N A Soonawala, former vice-chairman of Tata Sons, for instance, wrote in a newspaper column that a potential listing could fundamentally alter the group’s structure and dilute the social purpose. The Tata Trusts Chairman Noel Tata, himself, is not in favour of its listing.

What do the final guidelines on upper layer NBFCs say?

The upper shall consist of NBFCs having asset size of Rs 1 lakh crore and above as per the latest audited balance sheet for the financial year, as per the final norms released on Wednesday, June 24.

The criteria for identification of NBFC-UL shall be reviewed periodically. Further, the asset size threshold for identification of NBFC-UL shall be reviewed every three years.

Notably, the guidelines state that eligible government-owned NBFCs will also be eligible for inclusion in the upper layer framework.

MUST READ: Adani, Tata, Mahindra, Godrej double down on NCR real estate market

However, NBFCs that are fully government-owned and controlled have been exempted from listing on the exchange.

The RBI is expected to release an updated list of upper-layer NBFCs soon. The final directions released on Wednesday have no mention of the names of NBFCs that will be part of the upper layer.

So, the suspense over whether Tata Sons will be a part of it continues.

In an interaction with reporters post the monetary policy committee meeting earlier this month, RBI Governor Sanjay Malhotra had said that the list of upper-layer NBFCs would be updated shortly.

In the past, he had stressed that any entity that had a registration till it was not cancelled would continue to do business.

One TV report citing sources had recently said that Tata Sons may still remain part of the list till the central bank didn't take any final decision on the de-registration plea. 

So far, 15 NBFCs were identified for the upper layer. On the asset size alone, Tata Sons estimated to be having standalone assets of over Rs 1.75 lakh crore, will easily make it to the list. 

Tata officials will be keenly awaiting the list, as reportedly no decision has been taken yet on its proposal. 

By clearly stating that government-owned entities will be exempt from listing, there is perhaps a clear signal that Tata Sons may have little choice should RBI rule against its plea and it finds itself in the updated list that has been closely awaited.