RBI Eases Overseas Borrowing Rules, Removes Cap on Interest Costs

• RBI introduces changes to External Commercial Borrowing (ECB) framework, expanding eligible borrower and lender base.
• New regulations remove restrictions on the cost of borrowing for ECBs and simplify reporting requirements.
• Funds raised through ECB can now be used to purchase land, immovable property, and for acquisition of control, with specified conditions.
• RBI-regulated entities can use ECB funds for on-lending to individuals, with no restriction on such on-lending.
• The all-in-cost cap and the requirement for lower cost in refinancing ECBs have been removed, aligning with market conditions.