RBI relaxes norms for IDF-NBFCs

In a bid to ensure flow of funds to infrastructure projects, the Reserve Bank of India (RBI), on Thursday, allowed Infrastructure Debt Fund-Non-Banking Financial Companies to invest in public-private partnerships (PPPs) and infrastructure projects which have completed at least one year of satisfactory commercial operation. The maximum exposure that an IDF-NBFC can take on individual projects will be at 50 per cent of its total capital funds.

Additional exposure

An additional exposure up to 10 per cent could be taken at the discretion of the board of the IDF-NBFC.

The RBI, however, said that it could permit additional exposure up to 15 per cent (over 60 per cent) “subject to such conditions as it may deem fit to impose regarding additional prudential safeguards.”

The Reserve Bank of India also said that all assets covering PPP and post-commercial operations date (COD) infrastructure projects in existence over a year of commercial operation would be assigned a risk weight of 50 per cent.