{"id":375768,"date":"2026-02-16T15:00:57","date_gmt":"2026-02-16T09:30:57","guid":{"rendered":"https:\/\/www.scconline.com\/blog\/?p=375768"},"modified":"2026-02-16T14:50:06","modified_gmt":"2026-02-16T09:20:06","slug":"rbi-released-development-and-regulatory-policies","status":"publish","type":"post","link":"https:\/\/www.scconline.com\/blog\/post\/2026\/02\/16\/rbi-released-development-and-regulatory-policies\/","title":{"rendered":"Highlights of RBI&#8217;s Statement on Development and Regulatory Policies"},"content":{"rendered":"<div style=\"text-align: justify; line-height: 150%;\">\n<p style=\"margin-bottom: 3%;\">On 6-2-2026, the Reserve Bank of India (&#8216;RBI&#8217;) circulated a <span style=\"font-weight: bold;\">Statement on Development and Regulatory Policies<\/span>, announcing major regulatory, payments, financial inclusion, and market-related reforms.<\/p>\n<h2>Key measures relate to:<\/h2>\n<ol style=\"list-style-type: upper-roman;\">\n<li>\n<p style=\"font-weight: bold;\">Regulations<\/p>\n<ol style=\"list-style-type: lower-roman;\">\n<li>\n<p>RBI has decided to issue instructions to Regulated Entities (&#8216;REs&#8217;) to prevent mis-selling of financial products by REs, ensuring products match customer needs and risk appetite.<\/p>\n<\/li>\n<li>\n<p>Draft instructions will be issued to harmonise loan recovery practices across all REs, establishing unified standards for the engagement and conduct of recovery agents.<\/p>\n<\/li>\n<li>\n<p>Customer liability rules for digital fraud to be revised, including compensation mechanisms for small-value fraudulent transactions, reflecting technological advancements since 2017.<\/p>\n<\/li>\n<li>\n<p>Commercial Banks will be permitted to lend to Real Estate Investment Trusts (&#8216;REITs&#8217;), with safeguards similar to those for Infrastructure Investment Trusts (&#8216;InvITs&#8217;), aligning financing norms and deepening real-estate financing channels.<\/p>\n<\/li>\n<li>\n<p>Lending norms for Urban Cooperative Banks (&#8216;UCBs&#8217;) will be rationalised, simplifying unsecured loan rules, limits for nominal members, and housing loan conditions through a tiered approach.<\/p>\n<\/li>\n<li>\n<p>Type-I NBFCs with assets not more than &#8377;1,000 crore can be exempted from RBI registration, reducing compliance burden for low-risk entities.<\/p>\n<\/li>\n<li>\n<p>Gold-loan NBFC-ICCs with over 1,000 branches can no longer need prior RBI approval to open new branches, easing expansion due to their strong governance framework.<\/p>\n<\/li>\n<\/ol>\n<\/li>\n<li>\n<p style=\"font-weight: bold;\">Payments System<\/p>\n<\/li>\n<p>To promote safer digital payments, Discussion papers will be issued introducing calibrated safeguards in digital payments such as introduction of lagged credits, additional authentication for specific class of users like senior citizens, etc. The proposed measures are intended to mitigate frauds and strengthen customer protection.<\/p>\n<li>\n<p style=\"font-weight: bold;\">Financial Inclusion<\/p>\n<ol style=\"list-style-type: lower-roman;\">\n<li>\n<p><span style=\"font-weight: bold;\">Lead Bank Scheme<\/span> will be revised to enhance the effectiveness of the scheme. A unified portal will also be launched to consolidate bank-wise LBS data, enhancing data quality and insights.<\/p>\n<\/li>\n<li>\n<p>RBI will issue updated <span style=\"font-weight: bold;\">Kisan Credit Card<\/span> (&#8216;KCC&#8217;) norms to broaden coverage and simplify operations. It includes standardising crop seasons, extending KCC tenure to six years, aligning drawing limits with the Scale of Finance, and including costs related to technological interventions.<\/p>\n<\/li>\n<li>\n<p>Based on recommendations of a committee comprising RBI, DFS, IBA, and NABARD officials, the RBI is revising BC guidelines to boost efficiency in delivering last-mile financial services.<\/p>\n<\/li>\n<li>\n<p>To improve credit access for Micro and Small Enterprises, the collateral-free loan limit has been increased from &#8377;10 lakh to &#8377;20 lakh for loans sanctioned or renewed from 1-4-2026. This aims to support entrepreneurship and strengthen last-mile credit delivery.<\/p>\n<\/li>\n<\/ol>\n<\/li>\n<li>\n<p style=\"font-weight: bold;\">Financial Markets<\/p>\n<ol style=\"list-style-type: lower-roman;\">\n<li>\n<p>To deepen the corporate bond market and enhance credit risk management, the RBI will introduce a regulatory framework enabling total return swaps on corporate bonds and derivatives based on corporate bond indices. These measures aim to improve liquidity, broaden participation, and support bond issuance across rating categories.<\/p>\n<\/li>\n<li>\n<p>RBI has reviewed and rationalised FEMA-based foreign exchange regulations to reflect evolving domestic and global market practices. The revised framework will provide authorised banks and standalone primary dealers with greater flexibility in forex products, risk-management tools, and trading platforms.<\/p>\n<\/li>\n<li>\n<p>Given the strong utilisation of over 80% of the &#8377;2.5 lakh crore VRR limit, the RBI will enhance predictability and ease of doing business for FPIs by (a) counting VRR investments under the General Route limits, and (b) offering additional operational flexibilities. These reforms aim to attract long-term foreign investment into India&#8217;s debt markets.<\/p>\n<\/li>\n<\/ol>\n<\/li>\n<li>\n<p style=\"font-weight: bold;\">Capacity Building<\/p>\n<\/li>\n<p style=\"margin-bottom: 3%;\">Mission <span style=\"font-weight: bold;\">SAKSHAM<\/span> (<span style=\"font-style: italic;\">Sahakari Bank Kshamta Nirman<\/span>) will be launched as a sector-wide capacity-building and certification programme for Urban Cooperative Banks, offering large-scale physical and digital training to about 1.40 lakh participants, with delivery in regional languages and support from UCB federations.<\/p>\n<\/ol>\n<p style=\"margin-bottom: 3%;\">All these statements aim at strengthening consumer protection, enhancing financial system stability, and supporting growth across key segments of the economy.<\/p>\n<\/div>\n","protected":false},"excerpt":{"rendered":"<p style=\"font-style: italic;\">RBI has set out key development and regulatory policies to enhance regulation, inclusion and market efficiency.<\/p>\n","protected":false},"author":67525,"featured_media":375771,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"_jetpack_memberships_contains_paid_content":false,"footnotes":""},"categories":[4,15],"tags":[44061,11241,98868,44235,61410,98867,51944,98870,2945,2611,98866,51945,98869,98871],"class_list":["post-375768","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-legislationupdates","category-rules_regulations","tag-banking-regulations","tag-consumer-protection","tag-corporate-bond-market","tag-digital-payments","tag-financial-inclusion","tag-financial-reforms","tag-invits","tag-mission-saksham","tag-NBFC","tag-RBI","tag-regulatory-policies","tag-reits","tag-ucb","tag-vrr"],"yoast_head":"<!-- This site is optimized with the Yoast SEO Premium plugin v26.4 (Yoast SEO v26.4) - https:\/\/yoast.com\/wordpress\/plugins\/seo\/ -->\n<title>RBI Development and 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lending by banks and NBFCs to improve transparency risk sharing and borrower protection.","rel":"","context":"In &quot;Legislation Updates&quot;","block_context":{"text":"Legislation Updates","link":"https:\/\/www.scconline.com\/blog\/post\/category\/legislationupdates\/"},"img":{"alt_text":"RBI's Co-Lending Directions 2025","src":"https:\/\/i0.wp.com\/www.scconline.com\/blog\/wp-content\/uploads\/2025\/08\/RBIs-Co-Lending-Directions-2025.webp?resize=350%2C200&ssl=1","width":350,"height":200,"srcset":"https:\/\/i0.wp.com\/www.scconline.com\/blog\/wp-content\/uploads\/2025\/08\/RBIs-Co-Lending-Directions-2025.webp?resize=350%2C200&ssl=1 1x, https:\/\/i0.wp.com\/www.scconline.com\/blog\/wp-content\/uploads\/2025\/08\/RBIs-Co-Lending-Directions-2025.webp?resize=525%2C300&ssl=1 1.5x, https:\/\/i0.wp.com\/www.scconline.com\/blog\/wp-content\/uploads\/2025\/08\/RBIs-Co-Lending-Directions-2025.webp?resize=700%2C400&ssl=1 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The Statement sets out various developmental and regulatory policy measures relating to (i) regulation and supervision (ii) financial markets and (ii) payment and settlement systems. \u00a0 Key Highlights: RBI\u2026","rel":"","context":"In &quot;Legislation Updates&quot;","block_context":{"text":"Legislation Updates","link":"https:\/\/www.scconline.com\/blog\/post\/category\/legislationupdates\/"},"img":{"alt_text":"","src":"https:\/\/i0.wp.com\/www.scconline.com\/blog\/wp-content\/uploads\/2021\/08\/rbi_2.jpg?resize=350%2C200&ssl=1","width":350,"height":200,"srcset":"https:\/\/i0.wp.com\/www.scconline.com\/blog\/wp-content\/uploads\/2021\/08\/rbi_2.jpg?resize=350%2C200&ssl=1 1x, https:\/\/i0.wp.com\/www.scconline.com\/blog\/wp-content\/uploads\/2021\/08\/rbi_2.jpg?resize=525%2C300&ssl=1 1.5x, https:\/\/i0.wp.com\/www.scconline.com\/blog\/wp-content\/uploads\/2021\/08\/rbi_2.jpg?resize=700%2C400&ssl=1 2x, https:\/\/i0.wp.com\/www.scconline.com\/blog\/wp-content\/uploads\/2021\/08\/rbi_2.jpg?resize=1050%2C600&ssl=1 3x"},"classes":[]},{"id":194239,"url":"https:\/\/www.scconline.com\/blog\/post\/2018\/03\/20\/key-recommendations-of-the-report-of-the-working-group-on-fin-tech-and-digital-banking\/","url_meta":{"origin":375768,"position":4},"title":"Key recommendations of the Report of the Working Group on Fin Tech and Digital Banking","author":"Saba","date":"March 20, 2018","format":false,"excerpt":"Reserve Bank of India (RBI) had set up an inter-regulatory Working Group (WG) to look into and report on the granular aspects of Fin Tech and its implications so as to review and reorient appropriately the regulatory framework and respond to the dynamics of the rapidly evolving Fin Tech scenario.\u2026","rel":"","context":"In &quot;Business News&quot;","block_context":{"text":"Business News","link":"https:\/\/www.scconline.com\/blog\/post\/category\/news\/business_news\/"},"img":{"alt_text":"","src":"","width":0,"height":0},"classes":[]},{"id":256608,"url":"https:\/\/www.scconline.com\/blog\/post\/2021\/11\/01\/rbi-issues-revised-regulatory-framework-for-nbfcs-scale-based-regulation-sbr\/","url_meta":{"origin":375768,"position":5},"title":"RBI issues revised Regulatory Framework for NBFCs: Scale Based Regulation (SBR)","author":"Bhumika Indulia","date":"November 1, 2021","format":false,"excerpt":"RBI issues revised Regulatory Framework for NBFCs: Scale Based Regulation (SBR). These guidelines shall be effective from October 01, 2022. The instructions relating to ceiling on IPO funding given vide para 3.1(d) of the Annex shall come into effect from April 01, 2022. 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