Ans : IFCs may exceed the concentration of credit norms as provided in paragraph 18 of the aforesaid Directions as under: a. any single borrower by ten per cent of its owned fund, (i.e at 25% of Owned Funds) and, b. any single group of borrowers by fifteen per cent of its owned fund, (i.e. Here is everything you need to know about the new RBI guidelines on loan moratorium and what your current options are as a borrower. While the fund will have a corpus of ₹345 crore from the get-go, the RBI has introduced a fee that card networks and card-issuing banks will have to pay based on their annual turnover. Card networks to pay 1 basis point (bps) or, 0.01 paisa per rupee transaction, annually, Card issuing banks to 1 bps and 2 bps or, 0.01 paisa and 0.02 paisa per rupee transaction, for debit and credit cards respectively, on an annual basis, New entrants to the card payment eco-system (card issuer and card network) shall contribute an appropriate amount to the PIDF. The Central Government had, with effect from August 09, 2019, transferred regulatory powers of the Housing Finance Companies (“HFCs”) from the National Housing Bank (“NHB”) to the Reserve Bank of India (“RBI”).It is further stated that the RBI will review the extant of regulatory framework applicable to HFCs and issue the same in due course. at 50% of Owned funds). DIRECT HOUSING FINANCE 2.1 Direct Housing Finance refers to the finance provided to individuals or groups of individuals including co-operative societies. RBI’s proposals clearly define home finance firms. The minimum credit rating of the company should be at 'A' or equivalent of CRISIL, FITCH, CARE, ICRA, BRICKWORK or equivalent rating by any other accrediting rating agencies. Education Institutions (capital stock). The Reserve Bank of India (RBI) has introduced guidelines for the Payments Infrastructure Development Fund (PIDF) scheme, which will subsidise the deployment of … The guidelines will be technology and platform agnostic, the RBI said. Q.5. Ans: Infrastructure Finance Companies can maintain risk weight at 50% for assets covering PPP and post commercial operations date (COD) projects which have completed at least one year of satisfactory commercial operations and which are backed by a buyback guarantee by a designated Project / Statutory authority under a Tripartite Agreement. © Reserve Bank of India. Q.2. 3. The Reserve Bank of India has decided to assign risk weights for the rated exposures of banks to all non-banking financial companies (NBFC) to facilitate credit flow to the sector that is reeling under liquidity pressure post IL&FS defaults in August.The guidelines will be out by February end. But in the wake of the lockdown, digital... MediaNama is the premier source of information and analysis on Technology Policy in India. In order to encourage lending by banks to the infrastructure sector, banks are permitted to finance SPVs registered under the Companies Act, set up for financing infrastructure projects, after ensuring that these All Rights Reserved. Ans: Infrastructure Finance Companies can maintain risk weight at 50% for assets covering PPP and post commercial operations date (COD) projects which have completed at least one year of satisfactory commercial operations and which are backed by a buyback guarantee by a designated Project / Statutory authority under a Tripartite Agreement. 6. d) Infrastructure Finance Companies (IFCs) i.e. The PIDF will be operational for three years from 1 January 2021, and may be extended for two more years based on progress. RBI Guidelines for Cyber Security Framework RBI Guidelines for Cyber Security Framework In a race to adopt technology innovations, Banks have increased their exposure to cyber incidents/ attacks thereby underlining the urgent need to put in place a robust cyber security and resilience framework. iii. The above facility will be available only once during the life of the existing project loans. Ans: Infrastructure Finance Companies can maintain risk weight at 50% for assets covering PPP and post commercial operations date (COD) projects which have completed at least one year of satisfactory commercial operations and which are backed by a buyback guarantee by a designated Project / Statutory authority under a Tripartite Agreement. 2.2 Banks are free to evolve their own guidelines with the approval of their Boards on aspects such as security, margin, age of dwelling units, repayment schedule, etc. A lender who has extended only working capital finance for a project may be treated as 'new lender' for taking over a part of the project term loan as required under the guidelines. MUMBAI: The RBI on Tuesday permitted startups, banks and financial institutions to set up regulatory sandbox (RS) for live testing of innovative products in areas like retail payments, digital KYC and wealth management. Required fields are marked *. 5 DBOD-MC-Housing Finance - 2014 2. Infrastructure Finance Company (IFC): IFC is a non-banking finance company a) which deploys at least 75 per cent of its total assets in infrastructure loans, b) has a minimum Net Owned Funds of ₹ 300 crore, c) has a minimum credit rating of ‘A ‘or equivalent d) and a CRAR of 15%. While the RBI has contributed ₹250 crore to the initial corpus of the PIDF, major card networks have provided ₹95 crore so far. 5. Includes strategic storage of crude oil, 3. e) Foreign Currency Convertible Bonds (FCCBs) by Housing Finance Companies. RBI announces guidelines for Payments Infrastructure Development Fund. RBI has put in its web site newly proposed guidelines inviting observations from all stakeholders to be received latest by July 15, 2020 by email to feedbackhfc@rbi.org.in related to Housing Finance Companies popularly known as “HFCs”. Includes optic fibre/cable networks which provide broadband / internet, 5. 2. Guidelines on infrastructure financing Please refer to our Industrial & Export Credit Department's Circular No. NIIF Infrastructure Finance Limited was incorporated as an Infrastructure Debt Fund (IDF) on March 7, 2014 for financing operating infrastructure projects and carry on the business of IDF under NBFC Format as per RBI Guidelines. Deepa Mehta ‘disappointed’ Netflix India won’t be streaming Funny Boy, US Trade Representative publishes report blasting India’s 2% Equalisation Levy, MEITY considering reimbursing payment companies for UPI: Report, Twitter, Facebook, Instagram temporarily suspend Donald Trump’s account, Traders’ body wants 5% tax on e-commerce players. a. It has now been decided to introduce a fourth category of NBFCs as "Infrastructure Finance Companies" (IFCs). The Reserve Bank of India (RBI) on Friday released revised priority sector lending (PSL) guidelines to augment funding for COVID-19 impacted companies.. Also … Maximum cost of physical acceptance device to avail subsidy: ₹10,000 (including one-time operating cost upto ₹500), Maximum cost of digital acceptance device to avail subsidy: ₹ 300 (including one-time operating cost upto ₹200), AC should introduce a ‘minimum usage’ criteria set 50 transactions over a period of 90 days, Active status shall be minimum usage for 10 days over the 90-day period, 75% of the subsidy amount will be released on a half-yearly basis, 25% of the balance will be released if the acceptance device is active for 3 out of the 4 quarters of the ensuing year, The claim should be submitted only after making payment to the vendor, Acquiring players cannot claim the subsidy under the PIDF, if it is receiving a subsidy under other merchanisms for deploying payments infrastructure, If less than 75% of the target is achieved or utilised, the acquirer can only seek 90% of eligible subsidy, If 75% to 125% of the target is achieved or utilised, the acquirer can claim 100% of eligible subsidy, If more than 125% of the target is achieved or utilised, the acquirer can only seek 110% of eligible subsidy. More about MediaNama, and contact information, here. A PIDF essentially subsides the cost of acquisition for banks to deploy payments infrastructure like physical PoS devices, mobile PoS, GPRS (General Packet Radio Service), PSTN (Public Switched Telephone Network), QR code-based payments and other card based payments methods. The Reserve Bank of India (RBI) is conducting a special audit of Kolkata-based lender Srei Infrastructure Finance and its subsidiary, Srei Equipment Finance. The Reserve Bank of India has issued a revised set of guidelines for housing finance companies after it took over regulation of these lenders last year. This definition is used in order to provide tax breaks or subsidies that have been promised to the infrastructure sector. NIIF Infrastructure Finance Limited was incorporated as an Infrastructure Debt Fund (IDF) on March 7, 2014 for financing operating infrastructure projects and carry on the business of IDF under NBFC Format as per RBI Guidelines. Made in India. Further, exposure of a bank to the NBFCs-IFCs (Infrastructure Finance Companies) should not exceed 15 per cent of its capital funds as per its last audited balance sheet, with a provision to increase it to 20 per cent if the same is on account of funds on-lent by the IFCs to the infrastructure sector. (Photo: Mint) RBI proposes new rules for housing finance companies 2 min read. NBFC-Infrastructure Finance Company (NBFC-IFC) Provision of infrastructure loans. Payments infrastructure incurs a cost for all players in the chain, from banks, non-bank players like fintechs and wallet players to Point-of-Sale (PoS) device manufacturers. List of Infrastructure Finance Companies (NBFC-IFCs) registered with RBI (As on July 16, 2020) List of NBFC- Peer to Peer (P2P) registered with RBI (As on July 16, 2020) List of Deposit accepting NBFCs registered with RBI that have been prohibited from accepting deposits under Section 45 MB of RBI Act,1934 (As on September 30, 2019) While the RBI has set out broad guidelines, it has formed an Advisory Council (AC) responsible for managing the fund and framing the operational rules. Srei Infrastructure Finance and its subsidiary Srei Equipment Finance, chairman Hemant Kanoria. The guidelines will be technology and platform agnostic, the RBI said. Q.3. Q.5. The extant norms for investment for both single party and single group of parties will remain same as in Para 18 of the Directions, i.e. Currently, the Reserve Bank has classified NBFCs under three categories, viz., Asset Finance Companies, Loan companies and Investment Companies. (Photo: Mint) RBI proposes new rules for housing finance companies 2 min read. The RBI said NBFCs can invest only in PPPs and post-commercial operations date infrastructure (COD) projects which have completed at least one year of commercial operations. ETBFSI; January 06, 2021, 11:51 IST at 40% of Owned Funds), ii. Should Amazon, Flipkart Show Country Of Origin Of Products? SREI Infrastructure Finance slumped 14.61% to Rs 5.73 after the Reserve Bank of India (RBI) initiated a special audit of the company and its subsidiary. Housing finance companies will be treated as a category of non-banks The aim of the fund is to add 1 million physical payment acceptance devices and 2 million digital payments devices every year, the RBI says. Updated: 13 Aug 2019, 07:16 PM IST Shayan Ghosh. Ltd. Investment in shares of a single group of companies cannot exceed 25% of its Owned Funds. Relaxing the ECB norms, the RBI today said NBFCs operating as infrastructure finance companies (IFCs) can now avail the overseas borrowings up to 75 per cent of their owned funds without its approval. The Reserve Bank of India on Tuesday announced operational guidelines for the Payments Infrastructure Development Fund scheme.The RBI said that it has constituted an advisory council under the chairmanship of B.P. IMPORTANT GUIDELINES ON BANK FINANCE TO NBFC * Bank Finance to NBFC registered with RBI •Banks are permitted to extend need based working capital facilities as well as term loans to all NBFCs registered with RBI and engaged in infrastructure financing, equipment leasing, hire purchase, loan, factoring and investment activities. Copyright © 2020 MediaNama. Ans “Infrastructure loan” means a credit facility extended by NBFCs to a borrower for exposure in the following infrastructure sub-sectors: 1. Kanungo, a deputy governor, to manage the fund. Updated: 13 Aug 2019, 07:16 PM IST Shayan Ghosh. 6. For the same, The Reserve Bank of India (RBI) made amendments to the administrative structure for housing finance companies (HFCs) on 22 October 2020. Read more about SREI Infra tumbles after RBI initiates special audit on Business Standard. Annex II - Guidelines on Liquidity Risk Management Framework ... (vi) every Non-Banking Finance Company - Infrastructure Finance Company (NBFC-IFC) registered with the Bank under the provisions of RBI Act, 1934 and having an asset size of ₹ 500 crore and above. RBI FAQS on Infrastructure Finance Companies (IFCs) TG Team | Fema / RBI - Articles; 20 Mar 2016; 1,627 Views; 0 comment; Infrastructure Finance Companies (IFCs) Q.1. The funds will be collected January 31, 2021. RBI has been receiving requests in the recent past suggesting a need for review of guidelines on infrastructure financing by banks. Meantime, to facilitate raising of funds for longer term lending, RBI has said that long-term bonds sold to finance the infrastructure sector will be exempt from certain regulatory requirements. 2. (Mint file) RBI to issue revised norms for housing finance companies 1 min read. . Their request must be supported by a certificate from their Statutory Auditors confirming the asset pattern of the company as on March 31, of the latest financial year. RBI’s proposals clearly define home finance firms. The stock of Srei Infrastructure Finance Ltd (SIFL) took a beating on the bourses in Monday’s trade in the backdrop of the Reserve Bank of India (RBI) engaging an … In a move aimed to at boost infrastructure financing, especially for the projects in roads and power sector, the Reserve Bank of India (RBI) has eased the norms for treating bank loans as secured finance even in the absence of collaterals.. The final guidelines follow a draft issued in June this year and seek to harmonise regulations between non-bank lenders and housing financiers. After CEO Dick Costolo, Twitter’s M&A Head Rishi Garg Quits, Gujarat HC Gives Livestreaming Court Proceedings A Shot, Sunil Mehta, Chief Executive of the Indian Banks’ Association, Dilip Asbe, Chief Executive Officer, National Payments Corporation of India, Vishwas Patel, Chairman of Payments Council of India, Shailesh Paul, Vice President and Head Merchant Sales and Solutions, Visa, Rajeev Kumar, Senior Vice President, Market Development, Mastercard, D Nageswara Rao, Chief General Manager, NABARD, R Vittal Raj, Chartered Accountant, Kumar & Raj Chartered Accountants, Ajay Michyari, Regional Director, Reserve Bank of India, Card issuing banks should pay ₹ 1 per debit card and ₹3 per credit card they have issued. Ans “Infrastructure loan” means a credit facility extended by NBFCs to a borrower for exposure in the following infrastructure sub-sectors: Sl.No. The fund will be used to subsidize banks and non-banks for deploying payment infrastructure. Includes cold room facility for farm level pre-cooling, for preservation or storage of agriculture and allied produce, marine products and meat. Updated: 18 Jun 2020, 12:09 AM IST Gopika Gopakumar. RBI has been easing norms for borrowings by various entities in the past few weeks – from infrastructure firms to non-banking finance companies – as the credit markets have turned tight following the default by Infrastructure Leasing & Financial Services Ltd. The RBI, which has taken over the regulation of HFCs about a year ago, has come up with a revised regulatory framework for the HFCs. Yours faithfully (C.D. Let us grasp the extant guidelines which do alter our ways to do business with HFCs. Q.4. NBFC-Systemically Important Core Investment Company (CIC-ND-SI) Investment in equity shares, preference shares, debt or loans of group companies. What constitutes ‘credit facility’ under the definition of infrastructure loan? RBI has been easing norms for borrowings by various entities in the past few weeks – from infrastructure firms to non-banking finance companies – as the credit markets have turned tight following the default by Infrastructure Leasing & Financial Services Ltd. Includes supporting terminal infrastructure such as loading/unloading terminals, stations and buildings, 2. What is an Infrastructure finance? Housing finance companies will be treated as a category of non-banks The COVID-19 pandemic shut businesses and restricted people from normal activity for several months in 2020. Q.5. RBI issues guidelines for banks sponsoring infrastructure debt funds. Q.5. RBI said that under extant guidelines on Basel III Capital Regulations, exposures/claims of banks on rated as well as unrated Non-deposit Taking Systemically Important Non-Banking Financial Companies (NBFC-ND-SIs), other than Asset Finance Companies (AFCs), Non-Banking Financial Companies – Infrastructure Finance Companies (NBFCs-IFC) and Non-Banking Financial Companies – Infrastructure … What is the risk weight IFCs have to maintain on assets covering PPP and which have completed one year of commercial production? Having norms for dividend distribution by finance companies has become necessary due to their increasing significance in the financial system and their interlinkages with different segments. The current legal status. 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