The Reserve Bank of India has amended its prudential capital adequacy directions for non-banking financial companies (NBFCs), updating the risk weights applied to on-balance sheet loans to “high-quality infrastructure projects”. The revised treatment links the risk weight to the borrower’s repayment of a minimum percentage of sanctioned project debt. Under the amended table in paragraph 18(1), loans to qualifying high-quality infrastructure projects receive a 75% risk weight once at least 2% of sanctioned project debt has been repaid and a 50% risk weight once at least 5% has been repaid. If a project that qualified as a high-quality infrastructure project subsequently fails to meet the conditions, the exposure becomes subject to the risk weights prescribed under other specified entries in the same table. The repayment threshold must be assessed against sanctioned project debt, with any additional debt sanctioned (including as part of a loan takeover) aggregated with prior loans against the same project assets and/or cash flows for threshold determination. The amendments apply from April 1, 2026, or earlier if an NBFC adopts the directions in full. Where an exposure currently attracts a lower risk weight but would move to a higher risk weight under the amended directions, NBFCs may continue applying the existing risk weight until the next review or renewal, or March 31, 2027, whichever is earlier.
Reserve Bank of India 2026-01-01
Reserve Bank of India amends NBFC capital adequacy norms to apply 75% and 50% risk weights to high-quality infrastructure project loans
The Reserve Bank of India has revised prudential capital adequacy directions for non-banking financial companies, adjusting risk weights for loans to high-quality infrastructure projects based on repayment thresholds. The amendments, effective April 1, 2026, or earlier if adopted, allow NBFCs to maintain existing risk weights until March 31, 2027, if the revised directions would increase them.