1.RBI Credit Market Reforms (RBI Credit Reforms)
What & Where
Definition: RBI Oct 2025 credit-reform package to deepen Indian financial markets and internationalise the rupee
Processes: bank funding for M&A, cross-border rupee lending, higher capital-market limits, wider SRVA investment scope
Geography: India nationwide; external focus on Nepal, Bhutan, Sri Lanka for rupee loans
Quick Facts for MCQs
Banking Reforms
- Lending banks allowed M&A financing, shifting domain from NBFCs and private funds
- Lower risk weights for MSME and housing loans under revised Basel III ease capital strain
- Need for strengthened credit appraisal to mitigate promoter risk and concentration
Capital Market Moves
- Limit against shares lifted to ₹1 crore, boosting collateral based funding
- IPO financing cap raised to ₹25 lakh, expected to energise primary issues
- SRVA balances now investable in corporate bonds, widening investor base
Rupee Internationalisation
- Rupee loans to Nepal Bhutan Sri Lanka reduce dollar dependence in regional trade
- FBIL to add more partner currency benchmarks, enabling direct forex quotes without USD
- Measures complement BRICS discussions on non-dollar settlement alternatives
Key Data Points
| Feature | Data-Point |
|---|---|
| Bank takeover financing | Permitted to scheduled commercial banks for first time |
| Loan against shares cap | ₹1 crore (raised from ₹20 lakh) |
| IPO financing cap | ₹25 lakh (raised from ₹10 lakh) |
| Revised Basel III start | April 2027 |
| Neighbours eligible for rupee loans | Nepal, Bhutan, Sri Lanka |
| SRVA investable instruments | Corporate bonds & Commercial paper, besides G-secs |
| FBIL benchmark currencies | Expanding beyond USD, Euro, Pound, Yen |
Related UPSC Prelims PYQs
भारत के संदर्भ में, निम्नलिखित कथनों पर विचार कीजिए :
The Narasimham Committee for Financial Sector Reforms has suggested reduction in




