Due Diligence Report RBI

RBI Due Diligence Report: All you need to know

In India every year, every company (listed/Non-listed or Indian/Foreign) is required to submit RBI due diligence report for the Previous Financial year to all the bankers with whom the company is having banking limits (Such as working capital loan, short term loan, Buyer’s credit, etc).

However, those banks with whom the company is not having the limit may also ask for the RBI due diligence report.

This report is different from that diligence report which is used in merger and acquisitions and is a requirement for closing the deal in between two parties.

There is no fixed format of a diligence report however the bank usually required the below-mentioned information:

  • 1. Details of the Board of Directors who were managing the company.
  • 2. Details of the changes that took place during the period under review in the Board of Directors of the Company such as (Cessation/ Appointment).
  • 3. The shareholding pattern of the company.
  • 4. Details of the changes that took place in the shareholding pattern of the Company during the period under review.
  • 5. Details of any alteration in Articles of Association/Memorandum of Association.
  • 6. Details of the transactions with business entities in which directors of the company were interested.
  • 7. Amount of loans advanced, given guarantees, and provided securities to its directors and /or persons or firms or companies in which directors were interested.
  • 8. Details of loans and investments; or given guarantees or provided securities to other business entities.
  • 9. The breakup of the Company’s borrowings.
  • 10. Details of default (If any) by the company in repayment of any public deposits, unsecured loans, debentures, facilities granted by banks, financial institutions, and non-banking financial companies.
  • 11. Whether the company has created, modified, or satisfied charges on its assets.
  • 12. Details of the investments in wholly-owned subsidiaries and /or Joint Ventures abroad made by the company.
  • 13. The Principal value of the forex exposure and overseas Borrowings of the company.
  • 14. Whether The Company has insured all its secured assets.
  • 15. Details of declared and paid dividends to its shareholders by the company.
  • 16. The name of the Company and or any of its Directors does not appear in the defaulters’ list of Reserve Bank of India.

The information sought & the Annexures should be certified by a Company Secretary (CS) of the company or a practicing Chartered Accountant (CA).

Below are the formats which can be used for the preparation of Due diligence report:

  1. Sample due diligence report format
  2. Domestic borrowing details format
  3. Foreign currency exposure format
  4. List of directors format
  5. List of shareholders format
1. What is a RBI Due diligence report?

In the context of Banking Terms, the RBI Due diligence report is basically an information report sought by the bankers which contains Key details about the Company’s board of directors details, Shareholding details, banking details, foreign currency risk assessment (If any) , changes in the business of the company ( If any), related party transactions (If any), Investment by the company in Joint ventures/subsidiaries/associates etc.

2. Who is required to submit the RBI Due diligence report?

In India every year, every company (listed/Non-listed or Indian/Foreign) is required to submit RBI diligence report for the Previous Financial year to all the bankers with whom the company is having banking limits (Such as a working capital loan, short term loan, Buyer’s credit etc). This requirement is also mentioned in the company’s borrowing sanction letter.

3. What are the key details in a RBI Due diligence report?

RBI Due diligence report includes key details about the Company’s board of directors details, Shareholding details, banking details, foreign currency risk assessment (If any) , changes in the business of the company (If any), related party transactions (If any), Investment by the company in Joint ventures/subsidiaries/associates, etc.

4. Format of the RBI Due diligence report?

There is no fixed format of an RBI due diligence report, however, the bank usually required the below-mentioned information, the information sought & the Annexure should be certified by a Company Secretary of the company or a practicing Chartered Accountant.

5. Who can certify the RBI Due diligence report?

The Due diligence report should be certified by a Company Secretary of the company or a practicing Chartered Accountant

6. What is the last date of submitting the RBI Due diligence report?

There is no fixed date for the submission of the Due diligence report, usually, it’s submitted within 15 days from the date on which the accounts are adopted for the previous year at the annual general meeting. In private companies, it is submitted within 15 days from the date of signing of the Annual report.


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