Priority sector lending guidelines

The Reserve Bank of India (RBI) has introduced new Priority Sector Lending (PSL) guidelines, set to take effect from April 1, 2025, following a comprehensive review and stakeholder consultations. These are expected to enhance the inflow of credit flow to priority sectors and boost inclusive growth. It has increased the limits for education loans, renewable energy loans, as well as for loans under the affordable housing category

Risk weights on bank loans to NBFCs

The Reserve Bank of India (RBI) has restored the risk weights on bank loans to Non-Banking Financial Companies (NBFCs) to 100 per cent from the earlier 125 per cent, effective April 1, 2025, providing relief to the sector struggling with higher borrowing costs.

New guidelines for UPI

The National Payments Corporation of India (NPCI) is implementing new guidelines for Unified Payments Interface (UPI) number-based transactions starting April 1, 2025. This regulatory change requires banks and Payment Service Provider (PSP) apps to update mobile number records weekly to mitigate errors in transaction processing. UPI users will have to explicitly opt in for the seeding of their UPI numbers, that is user consent is mandatory. The aim of this is to boost security and bring down fraudulent transactions.

ATM charges raised

The Reserve Bank of India (RBI) has increased the maximum fee banks can charge customers for ATM cash withdrawals to ₹23. This new fee, which will come into effect on May 1, 2025, replaces the previous cap of ₹21

SRO guidelines for MFIs

RBI-recognised SRO for micro finance companies MFIN’s revised guidelines for MFIs come into play from April 1. Under the new guidelines, a borrower cannot get loans from four lenders at one time.

Prompt Corrective Action Framework for Urban Cooperative Banks

Urban Cooperative Banks, showing signs of financial stress, will be brought under the Prompt Corrective Action framework of RBI, replacing the existing Supervisory Action Framework. It will be effective April 1 and compared to the SAF, it will be principle-based with fewer number of parameters. The norms that will invoke the framework are losses being incurred for two consecutive years, net NPAs above 6 per cent but below 9 percent, and Capital Adequacy Ratio up to 250 bps below the required  CAR.