An LEI number (Legal Entity Identifier) has become a mandatory compliance requirement for many businesses operating in India’s financial ecosystem. Introduced to improve transparency and reduce financial risk, the LEI system helps regulators identify parties involved in financial transactions. If your organization participates in banking, capital markets, or cross-border trade, understanding who needs an LEI number in India is essential.

This guide explains which entities require an LEI number, why it matters, and how LEI code search helps verify business credibility.

What Is an LEI Number?

An LEI number is a unique 20-character alphanumeric code used to identify legally registered entities involved in financial transactions. It is issued under global standards set by the Global Legal Entity Identifier Foundation (GLEIF).

In India, LEI implementation is regulated by the Reserve Bank of India (RBI) and is mandatory for specific transaction types to enhance transparency and risk monitoring.

Why LEI Numbers Are Important in India

The Indian financial system handles millions of high-value transactions daily. Without a standardized identification system, tracking counterparty risk becomes difficult. LEI numbers help:

• Improve transparency in financial transactions

• Reduce fraud and systemic risk

• Enable better regulatory oversight

• Simplify entity identification globally

• Enhance trust among lenders and investors

Because of these benefits, the RBI has made LEI mandatory for several categories of entities.

Who Needs an LEI Number in India?

1. Companies Borrowing from Banks

All entities with aggregate fund-based and non-fund-based exposure above prescribed limits must obtain an LEI number. Banks are not permitted to process transactions without a valid LEI.

2. Participants in Large-Value Transactions

Entities involved in transactions of ₹50 crore and above (as per RBI notifications) are required to quote their LEI number for payment processing.

3. NBFCs and Financial Institutions

Non-Banking Financial Companies, financial institutions, and market intermediaries must have an LEI for regulatory reporting and compliance.

4. Companies Trading in Derivatives

Businesses participating in OTC derivatives, forex, or interest rate derivatives must obtain an LEI number to comply with RBI and SEBI regulations.

5. Capital Market Participants

Entities issuing or investing in bonds, commercial papers, or other market instruments often need an LEI number for clearing and settlement.

6. Trusts, Partnerships, and LLPs

Not just companies—trusts, partnership firms, LLPs, and societies involved in regulated financial transactions also require an LEI.

Who Does Not Need an LEI Number?

Individuals acting in their personal capacity do not require an LEI number. However, once a legal entity is formed and participates in regulated transactions, LEI compliance becomes mandatory.

Role of LEI Code Search

An LEI code search allows banks, regulators, and counterparties to verify entity details instantly. Through LEI databases, users can access:

• Legal entity name

• Registration status

• Ownership structure

• Country of registration

• Validity and renewal status

LEI code search improves due diligence, reduces onboarding time, and supports informed decision-making.

Risks of Not Having an LEI Number

Failing to obtain or renew an LEI number can result in:

• Rejection of banking transactions

• Delays in loan disbursements

• Non-compliance penalties

• Loss of credibility with financial institutions

• Regulatory scrutiny

For businesses, this can directly impact cash flow and operational continuity.

Solution: How to Get an LEI Number in India

The LEI registration process is simple and fully online. Businesses must submit basic entity details, supporting documents, and pay the applicable fee. Once issued, the LEI number must be renewed annually to remain active.

Professional service providers like MNS Credit Management Group assist businesses with end-to-end LEI registration, renewal, and LEI code search support—ensuring compliance without delays or errors.

Who Should Apply for an LEI Immediately?

You should apply for an LEI number if your business:

• Has high-value banking exposure

• Deals in capital markets or derivatives

• Engages in cross-border transactions

• Requires faster regulatory approvals

• Wants improved financial transparency

Early registration helps avoid last-minute compliance issues.

Conclusion

Understanding who needs an LEI number in India is critical for businesses operating in regulated financial environments. With RBI mandates expanding, LEI compliance is no longer optional for many entities. From enabling secure transactions to improving global credibility, an LEI number plays a vital role in modern business operations. Using LEI code search and working with expert service providers ensures smooth compliance and uninterrupted financial activity.