**Summary:**
RBI Directive RBI201516381 DNBRPD.CC.No. 07903.10.001201516, issued on April 21, 2016, modifies the regulatory framework for Infrastructure Debt Fund Non-Banking Financial Companies (IDF-NBFCs). The directive amends the "Infrastructure Debt Fund-Non-Banking Financial Companies (Reserve Bank) Directions, 2011" issued on November 21, 2011. Specifically, it permits IDF-NBFCs to raise funds through shorter tenor bonds and Commercial Papers (CPs) from the domestic market, up to a limit of 10% of their total outstanding borrowings. This revision, made in consultation with the Government of India, aims to facilitate improved Asset Liability Management (ALM) for these institutions. Contact person for further information is C. D. Srinivasan, Chief General Manager.
Key Entities Referenced
Infrastructure Debt Fund Non-Banking Financial Companies (IDF-NBFCs): A type of Non-Banking Financial Company specifically focused on funding infrastructure projects.
Infrastructure Debt Funds (IDFs): Funds created to finance infrastructure projects, often sponsored by NBFCs.
Reserve Bank Directions, 2011: Regulatory guidelines issued by the Reserve Bank of India concerning Infrastructure Debt Fund Non-Banking Financial Companies.
Notification No.DNBS.233CGMUS2011: The specific notification number related to the Reserve Bank Directions, 2011.
Non-Banking Financial Companies (NBFCs): Financial institutions that provide bank-like services but do not hold a banking license.
Government of India: The governing body of India, consulted in the decision-making process regarding IDF-NBFCs.
Commercial Papers (CPs): A money-market security issued (sold) by large corporations to obtain funds to meet short-term debt obligations (for example, payroll, accounts payable and inventories) and is only backed by issuing bank or corporation promise to pay the face amount on the maturity date specified on the note
C. D. Srinivasan: Chief General Manager at Reserve Bank of India, as indicated by the sign-off in the document.
RBI/2015-16/381
DNBR(PD).CC.No. 079/03.10.001/2015-16 April 21, 2016
All Infrastructure Debt Fund- Non-Banking Financial Companies (IDF-NBFCs)
Madam/ Sir,
Infrastructure Debt Funds (IDFs)
Please refer to the Infrastructure Debt Fund-Non-Banking Financial Companies (Reserve
Bank) Directions, 2011 issued vide Notification No.DNBS.233/CGM(US)-2011 dated
November 21, 2011 (the Directions) prescribing detailed guidelines on the regulatory
framework for NBFCs to sponsor IDFs which are to be set up as NBFCs. In terms of the
extant instructions, IDF-NBFCs are allowed to raise resources through issue of bonds of
minimum five year maturity. On a review, with a view to facilitate better ALM, it has been
decided in consultation with the Government of India, to allow IDF-NBFCs to raise funds
through shorter tenor bonds and commercial papers (CPs) from the domestic market to the
extent of upto 10 per cent of their total outstanding borrowings.
Yours faithfully
(C. D. Srinivasan)
Chief General Manager