Date: 2026-01-13Category: Not ApplicableState: Union GovernmentCountry: India
RBI invites public comments on Draft Amendment Directions on ‘Clarification on Owned Fund / Tier 1 Capital computation for NBFCs / ARCs and applicability to “Credit / Investment Concentration” Norms’
**Executive Summary**
The Reserve Bank of India (RBI) has released Draft Amendment Directions on 'Clarification on Owned Fund / Tier 1 Capital computation for NBFCs/ARCs and applicability to "Credit / Investment Concentration" Norms'. The draft amends various Master Directions for Non-Banking Financial Companies (NBFCs), Asset Reconstruction Companies (ARCs), and Standalone Primary Dealers. Public comments on the draft are invited until January 28, 2026, via the 'Connect 2 Regulate' section on the RBI website or by email.
**Key Points / Main Content**
* **Purpose:** The draft aims to provide clarifications and revisions regarding the computation of Owned Fund / Tier 1 Capital for NBFCs/ARCs and its application to “Credit / Investment Concentration” Norms. This follows requests from NBFCs for review and clarification on certain aspects.
* **Amendment Scope:** The draft amends several Master Directions, including:
* Non-Banking Financial Companies – Prudential Norms on Capital Adequacy Directions, 2025 and Second Amendment Directions, 2026.
* Master Direction – Reserve Bank of India (Non-Banking Financial Companies - Concentration Risk Management) Directions, 2025 and Second Amendment Directions, 2026.
* Housing Finance Companies Directions, 2025 and Amendment Directions, 2026.
* Core Investment Companies Directions, 2025 and Amendment Directions, 2026.
* Mortgage Guarantee Companies Directions, 2025 and Amendment Directions, 2026.
* Asset Reconstruction Companies Directions, 2025 and Amendment Directions, 2026.
* Standalone Primary Dealers Directions, 2025 and Amendment Directions, 2026.
* **Comments Solicitation:** The RBI invites comments and feedback from stakeholders on the Draft Amendment Directions.
* **Feedback Deadline:** Stakeholders must submit their comments by January 28, 2026.
* **Submission Method:** Comments can be submitted through:
* The "Connect 2 Regulate" section of the RBI website.
* Email, with the subject line “Feedback on Draft Amendment Directions on ‘Clarification on Owned Fund / Tier 1 Capital computation for NBFCs / ARCs’ and applicability to "Credit/Investment Concentration" Norms"'.
* **Background:** Currently, NBFCs (other than NBFC-UL) and ARCs reckon Tier 1 Capital as on March 31 of the previous year for complying with Credit / Investment concentration norms.
**Impact Analysis**
**NBFCs (including Housing Finance Companies, Core Investment Companies, Mortgage Guarantee Companies)**
* **Impact:** The amendments will clarify how they should compute their Owned Fund / Tier 1 Capital and apply it to Credit / Investment Concentration norms.
* **Action Required:** Review the Draft Amendment Directions and provide comments to RBI by January 28, 2026.
**Asset Reconstruction Companies (ARCs)**
* **Impact:** The amendments will clarify how they should compute their Owned Fund / Tier 1 Capital and apply it to Credit / Investment Concentration norms.
* **Action Required:** Review the Draft Amendment Directions and provide comments to RBI by January 28, 2026.
**Standalone Primary Dealers**
* **Impact:** The amendments will clarify how they should compute their Owned Fund / Tier 1 Capital and apply it to Credit / Investment Concentration norms.
* **Action Required:** Review the Draft Amendment Directions and provide comments to RBI by January 28, 2026.
Key Entities Referenced
Reserve Bank of India: The central bank of India, responsible for regulating the banking sector and issuing the draft amendment directions.
Draft Amendment Directions on ‘Clarification on Owned Fund / Tier 1 Capital computation for NBFCs / ARCs and applicability to “Credit / Investment Concentration” Norms': The primary subject of the press release, outlining proposed changes to the calculation of capital for Non-Banking Financial Companies (NBFCs) and Asset Reconstruction Companies (ARCs).
Non-Banking Financial Companies (NBFCs): Financial institutions that provide banking services without holding a banking license.
Asset Reconstruction Companies (ARCs): Specialized financial institutions that purchase non-performing assets (NPAs) from banks and financial institutions.
Mumbai: The location of the Reserve Bank of India's Central Office, to which comments/feedback can be sent.
प्रेस प्रकाशनी PRESS RELEASE
भारतीय ररज़र्व बैंक
RESERVE BANK OF INDIA
वेबसाइट
:
www.rbi.org.in/hindi
संचार वर्भाग, केंद्रीय कायाालय, शहीद भगत ससिंह मागा, फोटा, म िंबई - 400 001
Website : www.rbi.org.in Department of Communication, Central Office, Shahid Bhagat Singh Marg, Fort,
ई-मेल/email : helpdoc@rbi.org.in Mumbai - 400 001 फोन/Phone: 022 - 2266 0502
January 13, 2026
RBI invites public comments on Draft Amendment Directions on ‘Clarification
on Owned Fund / Tier 1 Capital computation for NBFCs / ARCs and
applicability to “Credit / Investment Concentration” Norms’
The Reserve Bank of India (RBI) has released today the Draft Amendment
Directions on ‘Clarification on Owned Fund / Tier 1 Capital computation for
NBFCs / ARCs and applicability to “Credit / Investment Concentration” Norms’
which amend the Master Directions listed below:
(i) Reserve Bank of India (Non-Banking Financial Companies – Prudential Norms
on Capital Adequacy) Directions, 2025 vide Reserve Bank of India (Non-
Banking Financial Companies – Prudential Norms on Capital Adequacy)
Second Amendment Directions, 2026.
(ii) Master Direction – Reserve Bank of India (Non-Banking Financial Companies -
Concentration Risk Management) Directions, 2025 vide Reserve Bank of India
(Non-Banking Financial Companies - Concentration Risk Management) Second
Amendment Directions, 2026.
(iii) Reserve Bank of India (Housing Finance Companies) Directions, 2025 vide
Reserve Bank of India (Housing Finance Companies) Amendment Directions,
2026.
(iv) Reserve Bank of India (Core Investment Companies) Directions, 2025 vide
Reserve Bank of India (Core Investment Companies) Amendment Directions,
2026.
(v) Reserve Bank of India (Mortgage Guarantee Companies) Directions, 2025 vide
Reserve Bank of India (Mortgage Guarantee Companies) Amendment
Directions, 2026.
(vi) Reserve Bank of India (Asset Reconstruction Companies) Directions, 2025 vide
Reserve Bank of India (Asset Reconstruction Companies) Amendment
Directions, 2026.
(vii) Reserve Bank of India (Standalone Primary Dealers) Directions, 2025 vide
Reserve Bank of India (Standalone Primary Dealers) Amendment Directions,
2026.2
The comments on the said Draft Amendment Directions are invited from the
stakeholders till January 28, 2026. The comments / feedback may be submitted
through the link under the ‘Connect 2 Regulate’ Section available on the Reserve
Bank’s website or may alternatively be forwarded to
The Chief General Manager
Balance Sheet Group
Department of Regulation, Central Office
Reserve Bank of India, 13th Floor
Shahid Bhagat Singh Marg
Fort
Mumbai – 400 001
Or
by email
with the subject line Feedback on Draft Amendment Directions on ‘Clarification on
Owned Fund / Tier 1 Capital computation for NBFCs / ARCs” and applicability to
“Credit/Investment Concentration” Norms’.
Background and Objective
Currently, NBFCs (other than NBFC-UL) and ARCs reckon Tier 1 Capital as on
March 31 of the previous year for complying with Credit / Investment concentration
norms. RBI has been receiving requests from NBFCs for a review of these provisions
as well as for clarification on certain aspects of Owned Fund / Tier 1 Capital.
Accordingly, RBI has reviewed the relevant provisions / Directions / guidelines and
has proposed clarifications and revisions in the matter.
(Brij Raj)
Press Release: 2025-2026/1911 Chief General Manager