Draft directions on Lending to Related Parties by various institutions including commercial banks, small finance banks and non-banking financial companies (“Draft Directions”) have been issued by the RBI for public comments by 31st October 2025. We are analysing the Draft Directions individually and our detailed assessment shall be shared in the coming days on the same.
The Draft Directions outline the proposed framework for regulated entities regarding lending to related parties. They aim to strike a balance between maintaining prudential safeguards and providing banks with the necessary operational flexibility in such transactions.
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