22 Jun 2021, 12:00 — 5 min read
Legal Entity Identifier (LEI) is a global reference number that uniquely identifies every legal entity/ company that is a party to a financial transaction in any jurisdiction.
This is basically required for companies/ organisation that are taking new loans/ funds from financial institutions or for the existing loans and funds availed from financial institutions or banks.
Any Bank, Financial institution, Company, Trust, Partnership Firm, Asset Management Companies, Mutual Funds, Holdings, Housing Finance Companies, Insurance Companies, Cooperative societies, /Pension Fund and Alternate Investment (AIF), Derivatives etc who are parties to financial transactions can apply for LEI.
All borrowers of banks / financial institutions having total fund based and non-fund-based exposure of INR 5 crore and above shall mandatorily apply for LEI. All the intended borrowers of INR 5 crore and above shall also apply for LEI.
LEI is issued as per the Payment and Settlement Systems Act 2007 (as amended in 2015) and regulated by Reserve Bank of India (RBI) through the “Issuers”.
The “Issuers” shall also be accredited by the Global Legal Entity Identifier Foundation (GLEIF) as a Local Operation Unit (LOU) for issuance and management of LEI's in India.
LEI is a 20-digit unique code to identify parties to financial transactions worldwide. The structure of the LEI is determined by ISO Standard 17442 and takes into account Financial Stability Board (FSB) stipulations.
The RBI has recognized the following companies as Issuers to issue, renew and manage the LEIs.
Entities without an LEI code will not to be granted loans, renewal, enhancement of loans, credit facilities.
The LEI number is useful to the Bank and Financials Institutions to improve the quality and accuracy of financial data systems for better risk management post the Global Financial Crisis.
This LEI number is also useful for the Bank and Financials Institutions to report the risk factors to the repositories.
The following documents are required:
Note: All the documents shall be certified under seal of the Company by authorized representative or MD or Director as per Board Resolution.
Different issuers collecting different fees for LEI new application, renewals or port-in potion. Legal Entity Identifier India Limited (LEIL) fee is as follows:
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Posted byAnil Kumar Ganga
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