The Reserve Bank of India announces the Third Amendment Directions for Non-Banking Financial Companies focused on enhancing income recognition and asset classification.
RBI Releases Third Amendment Directions for Non-Banking Financial Companies
On July 16, 2026, the Reserve Bank of India (RBI) released the Third Amendment Directions for Non-Banking Financial Companies (NBFCs) (RBI/2026-27/197, DOR.STR.REC.162/21-04-048/2026-27). These guidelines aim to reinforce measures for income recognition and asset classification, crucial for the financial soundness of NBFCs.
The amendments introduce more stringent requirements for asset classification in an effort to address risks associated with their operations. This governance enhancement is grounded in the powers conferred under sections 45JA and 45L of the Banking Regulation Act.
NBFCs and their legal advisors must prepare to navigate these changes, as compliance will be essential for maintaining market confidence and regulatory integrity.
Citations
- RBI/2026-27/197 DOR.STR.REC.162/21-04-048/2026-27