RBI Overhauls NBFC Infra Loan Rules: Lower Risk Weights for Quality Projects from April 1

• RBI revised risk-weighting for NBFCs' infrastructure project exposure, effective April 1, 2026, to align capital requirements with risk.
• "High-quality infrastructure projects" get lower risk weights: 75% if 2% of sanctioned debt repaid, 50% if 5% debt repaid.
• To qualify, projects must have 1 year of operations post-COD, no covenant breaches, 'standard' classification, and government-backed revenue rights.
• Requires strong contractual safeguards like escrow, pari-passu charge, and lender consent for borrower actions.
• Aims to promote accurate risk assessment, improved capital allocation, and financial stability in infrastructure financing.

Why It Matters: RBI introduces new risk-weight rules for NBFC infra loans, incentivizing quality projects with lower capital requirements.