What is an LEI?
A Legal Entity Identifier (LEI) is a unique 20-character alphanumeric code used to identify businesses and legal entities engaging in financial transactions globally. It is based on the ISO 17442 standard, established by the International Organization for Standardization (ISO).
The LEI system enhances transparency, accuracy, and trust in financial markets, helping regulators, banks, and institutions assess financial risks more effectively.
Each LEI record is publicly available in a standardized database and includes key company details such as:
✔ Registered & trading names
✔ Company type
✔ Registered address
✔ Business registration number
✔ Parent & child company relationships
Why was the LEI system created?
Following the 2008 Global Financial Crisis, regulators worldwide sought a standardized way to track financial transactions and verify corporate identities.
In response, the G20 (Group of Twenty) mandated the Financial Stability Board (FSB) to establish a universal LEI system. By December 2012, the LEI code was implemented, and in 2014, the Global Legal Entity Identifier Foundation (GLEIF) was created to oversee the LEI ecosystem.
The LEI system was designed to safeguard against future financial crises, ensuring greater transparency, accuracy, and risk assessment in global markets.
Benefits of the LEI code for Indian Businesses
Like Indian citizens with Aadhaar numbers for personal identification, companies also require a unique identifier—LEI.
Here’s how an LEI benefits Indian businesses:
Verifies legal identity – Confirms that the company is registered and active.
Facilitates cross-border transactions – Makes international trade & investments smoother.
Boosts global credibility – Strengthens trust with banks, investors, and international partners.
Improves financial reporting & transparency – Identifies parent-child business relationships.
Speeds up loan approvals – Helps banks process business loans faster.
Who needs an LEI code in India?
Any legal entity involved in financial transactions, regulatory reporting, or global trade must obtain an LEI code.
Key Indian sectors that require LEI:
Banking & Lending – The Reserve Bank of India (RBI) mandates LEI for corporate borrowers.
Stock & Derivatives Trading – The Securities and Exchange Board of India (SEBI) requires LEI for financial market participants.
Insurance Sector – The Insurance Regulatory and Development Authority of India (IRDAI) requires insurers to obtain LEIs.
Large Corporations & SMEs – Companies with bank loans exceeding ₹5 crore must register for an LEI.
How to Register for an LEI code?
Applying for an LEI is fast and easy. Whether you’re registering a new LEI, renewing an existing one, or transferring your LEI – you can complete the process in just two minutes.
Step 1: Visit LEIKart and choose your service.
Step 2: Fill in your business details & submit your application.
Step 3: Pay securely via card or bank transfer.
Step 4: Receive your LEI code confirmation via email.
Latest RBI guidelines for LEI registration in India
The Reserve Bank of India (RBI) has introduced multiple LEI regulations since 2017. The latest guidelines (21 April 2022) extend LEI requirements to businesses with total credit exposure of ₹5 crore or more.
LEI compliance deadlines for Indian borrowers:
| Total credit exposure | LEI deadline |
|---|---|
| Above ₹25 crore | 30 April 2024 |
| Above ₹10 crore, up to ₹25 crore | 30 April 2025 |
| ₹5 crore to ₹10 crore | 30 April 2025 |
Businesses that fail to obtain an LEI within the specified deadline may face banking restrictions.
Key takeaways
✔ LEI is mandatory for businesses engaging in financial transactions, banking, and cross-border trade.
✔ RBI & SEBI regulate LEI usage in India.
✔ Companies with bank exposure above ₹5 crore must obtain an LEI by 30 April 2025.
✔ An LEI improves business credibility, speeds up transactions, and enhances regulatory compliance.
✔ Registering for an LEI is quick, easy, and affordable with LEIKart.
