Tata Capital Financial Services and Tata Cleantech Capital will be merged with their parent company, Tata Capital, a stock exchange filing by Tata Capital Financial Services said.

The merger is being undertaken so that Tata Capital Financial Services can meet the revised regulatory framework as part of the Reserve Bank of India’s scale-based regulations.

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In September 2022, RBI had added Tata Capital Financial Services to its list of non-bank lenders in the upper layer under scale-based regulations. It has to implement a board-approved policy for adopting the applicable enhanced regulatory framework and mandatorily list within three years of the central bank’s classification as an ‘upper layer’ non-bank lender.

The merger scheme is subject to approvals from the NCLT, shareholders, creditors, and other regulatory bodies.