Non-Banking Financial Companies (NBFCs) are regulated by the RBI and are allowed to participate in the payment and settlement system, enabling them to issue cheques drawn on themselves.

While NBFCs are indeed regulated by the RBI and perform bank-like functions such as lending and asset financing, they are fundamentally different from banks. They cannot accept demand deposits (savings/current accounts), do not form part of the payment and settlement system, and consequently, cannot issue cheques drawn on themselves.