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Home > Income Tax > Help Center > NFIR / PCR - Explained Last Updated: Jan 12th 2024

NFIR - National Financial Information Registry Explained

NFIR is a new organisation established by the RBI to provide lending and government organisations with verifiable data points. Learn more about its nature, operation, and benefits.

NFIR - National Financial Information Registry Explained

This document covers

  1. Background
  2. What is NFIR and it's objective?
  3. Present process of Loan Approvals
  4. Todays role of CIBIL or similar CBs?
  5. Is NFIR much like India based credit bureaus?
  6. Key points from the proposed NFIR
  7. Conclusion

1. Background

Budget 2023 proposed that a National Financial Information Registry (NFIR) will be set up which will serve as central repository of financial and ancillary information. NFIR can be as revolutionary as Aadhaar.

More on Budget 2023 can be found @ Indian Budget 2023 Presentation and Analysis

Refer Indian Budget 2024 | Pre-Budget Expectations. from EZTax

2. What is NFIR and it's objective?

Credit bureaus give information on the credit taken out by a person or business, but they do not have complete visibility over the assets, activity, and liabilities position.

National Financial Information Registry (NFIR) is an autonomous state-owned organisation under RBI that facilitates data collecting, security frameworks, operating modalities, and a role-based information exchange mechanism for specified end points or organisations.

NFIR's major purpose is to construct a public infrastructure for sharing credit-related, activity-related, and asset-related information with lending and other selective authorities.

3. Current procedure for loan approvals

When a person applies for a loan, banks and other financial organisations will evaluate their creditworthiness. The banks will determine creditworthiness based on credit history and grant loans.

Credit History: A borrower's credit history is a record of debt repayments.

Credit Report: A credit report is a record of a borrower's credit history from a variety of sources, including banks, credit card companies, non-financial companies, etc.

CIBIL Score: It is a three-digit summary of the borrower's credit history, rating, and report, ranging from 300 to 900.

Credit Score Providers: Currently, RBI has licenced four organisations to give credit scores in India. These credit bureaus include CIBIL, Experian, Equifax, and Highmark. The Credit Information Bureau (India) Limited's CIBIL score is the most well-known in India. It is a three-digit summation of your credit history

Learn more on How to apply a Personal Loan

4. Todays role of CIBIL or similar CBs?

CIBIL plays the most significant function in the bank loan approval process. Banks and other financial organisations will check the CIBIL score and report of each applicant for a loan. Those with a high CIBIL score have the highest likelihood of loan acceptance.

To improve CIBIL credit score, refer Journey towards Higher Credit Score

To improve the chances of credit card approval, refer How to Boost Approval odds?

5. NFIR is anticipated to have a tenfold greater scope than CIBIL. Is it true?


While there are some similarities between the credit bureaus of today (such as TransUnion CIBIL, CRIF High Mark, Experian, and Equifax), NFIR has different objectives and a different scope.

Notably, three of the four credit bureaus, with the exception of CRIF High Mark, are based in the United States and operate in India with RBI approval.

In contrast, NFIR would be a state-owned entity operating independently.

The proposed scope of the data collection from NFIR is much broader and more comprehensive than that of existing credit bureaus such as CIBIL. As a result, the quality of information coming out of NFIR is anticipated to enable both financial and non-financial entities to offer credit much more quickly and accurately using straight-through processes.

Below is a comparison of "Today's Credit Bureaus" and "The Future with NFIR" on a variety of dimensions and aspects.

AspectToday's Credit BureausFuture with NFIR
ScopeOnly credit information collectionFinancial and non-financial information gathering
ObjectiveProvide a credit score so that lenders can offer credit..Provide lenders and governments with financial information that goes far beyond a simple credit score in order for them to offer credit and other services. It provides a comprehensive view of a person or organization's financial data (not just borrower).
OwnershipPrivate under RBI approvalsRegulator, RBI, Govt of India
Targeted forLender, BorrowerPublic, Lender, Borrower, and Government
Securitypotential lenders, your current lenders, insurance companies, employers can access without borrowers direct consentAccessible to the public only with your permission and additional safeguards.
What information available to share?Your credit report details all of your current and previous loans and credit card accounts. With complete payment history and default information.Your NFIR report may contain both credit side (like CIBIL) and scrubbed non-credit (assets, financial activity and behavioural information).
FeesFree of charge for you (once a year). Others pay bureau feesProbably similar
AvailabilityTodayDraft to be tabled with the parliament. First Phase ETA ~ CY 2024 (may take 2-3 years to get the support from various agencies)
National SecurityAcceptable as is, but cannot be expanded because the data is in private hands.Crucial to national security. Possibility to expand the scope beyond current expected approvals in the future.
How to fake it?To receive a high score, exercise self-control when borrowing and repaying money. Get a score. Create a fictitious balance sheet and income statement. You obtain what you desire - the next LARGE loan.NFIR defeats the purpose of fake balance sheets by providing lenders with co-related, credible financial information (IT, GST, ROC, etc.) that enables them to make more informed decisions.
Score CardNot adequately addressing NPAs despite achieving stated goals. Today's lenders collect a variety of borrower-provided data.The likelihood of lenders making wiser decisions is very high. Greater potential in the foreseeable future to seize nonperforming assets (NPA).
Critics concern on data securityToday, Credit Bureau companies are subject to regulatory oversight.Aadhaar is a state-owned, independent, and extremely successful entity. NFIR could be even better than Aadhaar.

6. Key points from the proposed NFIR

Budget 2023 proposed the establishment of a National Financial Information Registry (NFIR) to serve as a central repository for financial and supplementary data. The NFIR will promote credit flow efficiency, financial inclusion, and financial stability. The NFIR framework will be created in collaboration with RBI.

  1. NFIR includes both financial and nonfinancial details.
  2. NFIR includes information from the MCA (financials), SEBI (promoter and shareholding data), GST, CBDT, CBIC, and CERSAI.
  3. Through NFIR, the government and lenders can obtain comprehensive information about the borrower.
  4. NFIR's scope is significantly greater than CIBIL's, so it cannot be compared to CBs like CIBIL.
  5. If the lender lacks sufficient information about the borrower, this creates a risk for the lender, resulting in a higher interest rate.
  6. NFIR reduces risk for all parties involved and promotes equitable loan pricing.
  7. In subsequent phases, NFIR would augment RBI's due-diligence systems like CRILC.

7. Conclusion

Innovation, automation in the area of payments through UPI, new tax systems like GST, Income Tax, streamlining government organisations, and laws have strengthened the belief in India over the past six years that centralised infrastructure is necessary for direct interaction with the Indian people. In this course, we will assume that NFIR will be the next best milestone after Aadhaar.

Jai Hind

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Disclaimer: This article provides an overview and general guidance, not exhaustive for brevity. Please refer Income Tax Act, GST Act, Companies Act and other tax compliance acts, Rules, and Notifications for details.