RBI eases norms for loans to projects like roads and ports
MUMBAI: RBI has eased regulations for project financing, which will make it less expensive for lenders to provide loans for infrastructure and industrial projects like roads, ports and power plants.
The move acknowledges varying risk levels across sectors.
The regulator has finalised its project finance guidelines, effective Oct 1, 2025, offering more flexible and sector-specific norms. Key changes include reduced general provisions for under-construction and operational projects. Penalties for project delays have also been eased.
In the earlier draft, a delay beyond two years (infrastructure) or one year (non-infrastructure) attracted a 2.5% provision.
Now, it's reduced to about 0.4% and 0.6% per quarter of delay, respectively. Projects financially closed before Oct 1, 2025, are exempt - unless there's a credit event or major loan restructuring.
Instead of a flat 5% provision, commercial real estate (CRE) projects need 1.25% during construction and 1% when operational; CRE-residential housing requires 1% and 0.75%, while others need 1% and 0.4%.
The definition of credit events is now clearer, excluding vague clauses like "NPV (net present value) diminution."
by Taboola
by Taboola
Sponsored Links
Sponsored Links
Promoted Links
Promoted Links
You May Like
Giao dịch CFD với công nghệ và tốc độ tốt hơn
IC Markets
Đăng ký
Undo
It focuses on tangible signs like default, DCCO (date of commencement of commercial operations) extension, or financial stress. RBI has also simplified delay categorisation: Infrastructure projects can defer DCCO by up to three years; non-infra, including CRE and CRE-residential housing, by two.
Also, financial closure means 90% of funding is legally committed, with regulatory approvals tied to milestones instead of closure date - offering more realistic compliance.
The overall framework is more practical, aiding developers and lenders alike. The earlier draft norms were announced by then RBI governor Shaktikanta Das. His successor, Sanjay Malhotra, had announced that the norms would not enforced in FY25.
Commercial banks with substantial project finance portfolios would have faced a sharp rise in provisioning requirements, directly impacting their capital adequacy and profitability had RBI stuck to the earlier provisioning norms.
Power Finance Corporation (PFC) and Rural Electrification Corporation (REC), which together hold more than Rs 16 lakh crore in project loans, were highlighted as among the most exposed to these draft norms
Stay informed with the latest
business
news, updates on
bank holidays
and
public holidays
.
AI Masterclass for Students. Upskill Young Ones Today!– Join Now
Try Our AI Features
Explore what Daily8 AI can do for you:
Comments
No comments yet...
Related Articles
India Today
8 minutes ago
- India Today
Sensex jumps over 700 points: Why is the stock market rising today?
Benchmark stock markets saw a significant surge on Friday, with the S&P BSE Sensex climbing 695.99 points to reach 82,060.16 by 11:15 am. The NSE Nifty50 also experienced a rise, gaining 215.75 points to stand at 25, rally was largely driven by strong performances in banking and financial stocks, following a regulatory change by the Reserve Bank of India (RBI).advertisementThe primary catalyst for this rally was the RBI's announcement concerning infrastructure financing. The central bank has implemented new norms that relax provisioning requirements for under-construction infrastructure projects. This adjustment reduces the amount of capital banks and NBFCs are required to set aside for potential loan defaults, thereby enabling them to extend more credit, especially in sectors like power, housing, roads, and railways. The market responded positively to the RBI's policy update, with infrastructure financiers witnessing substantial gains. Shares of companies like Power Finance Corporation, REC, and IRFC saw strong intraday advances. Major contributors to the broader index gains included Jio Financial, Shriram Finance, Mahindra & Mahindra, and JSW Steel, with heavyweights such as Reliance Industries and State Bank of India also rising by 1-2%.Broader market sentiment was upbeat, although there has been volatility in recent sessions concerning small and mid-cap stocks. Dr. VK Vijayakumar, Chief Investment Strategist at Geojit Financial Services, noted the potential for the Nifty to remain range-bound between 24,500 and 25,000 in the near term. He said, "The upper side of the range will be broken only on news of de-escalation in the Israel-Iran conflict or an abrupt end to the war. There is uncertainty on this front."advertisementDespite the positive market conditions, Vijayakumar also highlighted concerns about the broader market. He pointed out that while the Nifty remains stable, small and mid-cap stocks have corrected sharply, with some seeing declines of up to 2%."This trend may persist as excessive valuations and risk-off sentiment continue to weigh on SMIDs," he remarked. Investors might consider redirecting their capital into more stable, fairly valued large-cap stocks across various sectors such as financials, industrials, autos, and real policy from the RBI is creating a favourable environment for markets, yet global uncertainties and sector-specific valuation concerns still loom over the market's future trajectory. Investors remain cautious, watching for developments that could impact market domestic institutional buying on market dips provides some cushion, geopolitical tensions and crude oil price fluctuations remain potential threats. For instance, if crude oil prices exceed $85 per barrel, the market's lower range could be tested. As Dr. Vijayakumar notes, the market's path forward is contingent on these today's market rally reflects a positive response to regulatory changes, but persistent global uncertainties suggest that further market shifts will heavily depend on external developments and ongoing valuation assessments. The optimism around infrastructure lending is a significant driver, but vigilance is necessary as the global landscape continues to In
Economic Times
8 minutes ago
- Economic Times
HUL shares among 8 stocks will trade ex-dividend on Monday. Do you own?
Those buying the stock on the ex-date are not eligible for dividends and after the implementation of the T+1 framework, the record date and ex-date are the same in most cases unless there is a market holiday after the ex-date. Hindustan Unilever and RailTel Corporation, along with eight other companies, have set November 6 as the record date for their declared dividends. Today marks the last day to purchase shares to qualify for these dividends. Tired of too many ads? Remove Ads Tired of too many ads? Remove Ads Tired of too many ads? Remove Ads Shares of Hindustan Unilever HUL ), Samvardhana Motherson International , among 6 other companies, will likely remain in focus today as they begin trading on an ex-dividend basis from Monday, June 23, meaning today is the last day to purchase these shares to be eligible for the record date is the cut-off set by the company to identify shareholders who will receive the dividend. If your name appears as a shareholder on this date, you are entitled to the dividend, regardless of when you bought the the other hand, the ex-dividend date (or ex-date) is the first day the stock trades without the dividend benefit. Anyone buying the stock on or after the ex-date will not receive the upcoming dividend. Typically, the ex-date falls one business day before the record Indian stock markets follow the T+1 settlement cycle, investors must complete their share purchases by June 19 for the transaction to be settled and reflected in their demat accounts by the record board of HUL had announced a final dividend of Rs 24 per share, fixing Monday, June 23 as the record date for determining the shareholder eligibility.'This is further to our letter dated 24th April, 2025, wherein the Company had informed that the Register of Members of the Company will remain closed from Tuesday, 24th June, 2025 to Monday, 30th June, 2025 (both days inclusive) for the purpose of payment of Final Dividend and AGM of the Company. This is to inform that the record date for the above purpose is Monday, 23rd June, 202,' the company the past 12 months, Hindustan Unilever has announced a total equity dividend of Rs 29.00 per share, and based on a share price of Rs 2,294.20, this translates to a dividend yield of 1.26%.HUL shares closed flat at Rs 2,294.20 on the BSE on is a list of other companies that will start trading ex-dividend from Friday:Dalmia Bharat– Final dividend of Rs 5 per share (250%)Dynamic Cables– Final dividend of Rs 0.5 per share (5%)Kalpataru Projects International– Final dividend of Rs 9 per share (450%)Kansai Nerolac Paints– Special dividend of Rs 1.25 per share (125%) and a final dividend of Rs 2.5 per share (250%)Motherson Sumi Wiring India– Final dividend of Rs 0.35 per share (35%) Pilani Investment and Industries Corporation – Final dividend of Rs 15 per share (150%) Samvardhana Motherson International– Final dividend of Rs 0.35 per share (35%)(Disclaimer: Recommendations, suggestions, views and opinions given by the experts are their own. These do not represent the views of The Economic Times)
Business Standard
8 minutes ago
- Business Standard
SBI Life crowdsources future-facing AI solutions from India's Next-Gen Talent pool at the 2025 Hack-AI-Thon finale
PRNewswire Mumbai (Maharashtra) [India], June 20: SBI Life Insurance, one of India's most trusted private life insurers, marked the finale of its national innovation initiative -- Hack-AI-Thon2025 -- a strategic platform to crowdsource artificial intelligence-driven solutions to real-business challenges faced by the insurance sector. The event culminated weeks of dynamic ideation and collaboration, with 16+ top teams (50+ participants) presenting AI-led innovations, focused on enhancing customer experience, operational efficiency, and digital service delivery. * The initiative underscored SBI Life's focus on innovation, young talent, and building future-ready insurance solutions The event was designed to tap into next-gen talent, foster a culture of co-creation, and accelerate digital transformation. The participants, including developers and AI enthusiasts, represented top institutes across Chennai, Bangalore, Hyderabad, Indore, Bhopal, and Delhi to compete on challenges ranging from predictive analytics and process automation to fraud detection and customer engagement. After rigorous jury round and evaluation, theInnovation Brigade team comprising of Ms. Asha Vidyadharan & Mr. Rameez Khan from Bhopal emerged as the winner of Hack-AI-Thon 2025, impressing the panel with their innovative solution at the Hack-AI-Thon 2025 Grand Finale. Similarly, Black Bird from Indore was chosen the 1st runner-up and from Trichy as well as Semantics from Pune were announced the 2ndrunners-up. Each of the winning solutions stood out for their innovative thinking, technical viability, and potential to address real-world challenges in the life insurance sector. Speaking on the grand finale of SBI Life's Hack-AI-Thon 2025, Mr. Ravindra Sharma, Chief of Brand, Corporate Communication and CSR, SBI Life Insurance, said, "The Hack-AI-Thon was conceptualised to engage the next generation of problem solvers in shaping the future of insurance. It is encouraging to see how young minds approach complex industry challenges with such clarity and purpose. At SBI Life, we believe that innovation must serve a meaningful purpose, and this initiative reflects our ongoing commitment to fostering technology-led thinking that is human-centric and impactful." He further added, "We have always believed that the true role of insurance goes beyond financial protection--it is about enabling individuals to move forward with confidence, to dream, to build, and to live fully. Hack-AI-Thon is an extension of this belief, as it invites young minds to co-create solutions that make protection more accessible, intuitive, and aligned with people's evolving needs and life goals. It is this blend of innovation and intent that we believe will help shape a more inclusive and empowering future not only for the insurance sector but the nation as a whole." After winning the Hack-AI-Thon 2025, the Innovation Brigade team said, "Participating in SBI Life's Hack-AI-Thon 2025 was a truly enriching experience, with outstanding coordination and expert mentorship at every step. Despite the tough pan-India competition, we are proud to share that we emerged as winners of the event." The Grand Finale jury comprised seasoned experts from technology & insurance, who evaluated teams on innovation, feasibility, scalability, and impact. Select ideas from the Hack-AI-Thon will be explored further for piloting or integration within the company's digital roadmap. With this initiative, SBI Life Insurance reinforces its commitment to fostering a culture of innovation, collaboration, and customer-first thinking through digital transformation. About SBI Life Insurance SBI Life Insurance ('SBI Life' / 'The Company'), one of the most trusted life insurance companies in India, was incorporated in October 2000 and is registered with the Insurance Regulatory and Development Authority of India (IRDAI) in March 2001. Serving millions of families across India, SBI Life's diverse range of products caters to individuals as well as group customers through Protection, Pension, Savings and Health solutions. Driven by a 'Customer-First' approach, SBI Life places great emphasis on maintaining world class operating efficiency and providing a hassle-free claim settlement experience to its customers by following high ethical standards of service. Additionally, SBI Life is committed to enhance digital experiences for its customers, distributors and employees alike. SBI Life strives to make insurance accessible to all, with its extensive presence across the country through its 1,110 offices, 26,355 employees, a large and productive network of about 240,304 agents, 60 corporate agents and 13 bancassurance partners with more than 41,000 partner branches, 141 brokers and other insurance marketing firms. In addition to doing what's right for the customers, the company is also committed to provide a healthy and flexible work environment for its employees to excel personally and professionally. SBI Life strongly encourages a culture of giving back to the society and has made substantial contributions in the areas of child education, healthcare, disaster relief and environmental upgrade. In 2024-25, the Company touched over 50,000 direct beneficiaries through various CSR interventions. Listed on the Bombay Stock Exchange ('BSE') and the National Stock Exchange ('NSE'), the company has an authorized capital of Rs. 20.0 billion and a paid-up capital of Rs. 10.0 billion. The AuM is Rs.4,480.4 billion. For more information, please visit our website, and connect with us on Facebook, Twitter, YouTube, Instagram, and LinkedIn. (Numbers & data mentioned above are for the year ended March 31, 2025)
