RBI Grade BNABARD ESISEBI
In one line
Context:
During the pre-Budget meeting with Finance Minister Nirmala Sitharaman, representatives of the Banking, Financial Services and Insurance (BFSI) sector, especially NBFCs, presented key demands aimed at improving liquidity, recovery efficiency, and deposit mobilisation.
Key Demands Made by NBFCs
Dedicated Refinance Window for NBFCs
- Similar to the National Housing Bank (NHB) model.
- Meant to ensure a steady and sustainable flow of funds.
- Funds raised through this window should be exclusively used for MSME and priority sector lending.
- Expected to help smaller NBFCs facing liquidity constraints.
Amendments to SARFAESI Act
Current Issue
- Only loans above ₹20 lakh come under SARFAESI recovery provisions for NBFCs.
- Smaller NBFCs with smaller ticket-size loans are excluded.
Proposal
Free live session
NABARD Grade A 2026: what the 2025 cut-offs changed, and the 90-day plan
In 8 days · Sun, 4 Oct at 7:30 PM IST
“RBI MPC Unpacked: Key Theory Meets Today’s Macro Trends”Tap to play · from the C4S channel
- Reduce the threshold from ₹20 lakh to ₹1 lakh.
- Enables more NBFCs to use SARFAESI for efficient recovery.
- Strengthens overall asset quality and recovery mechanisms.
Remove TDS on Non-Individual Borrowers
- NBFCs argued that TDS deducted from non-individual borrowers (corporates, firms, etc.) does not generate additional revenue for the government.
- Requested the government to remove TDS requirement, easing compliance and cash flows.
Education Loan Deduction Benefit for NBFCs
- Proposal to notify NBFCs under Section 80E of the Income Tax Act.
- This would allow borrowers taking education loans from NBFCs to claim tax deduction on interest.
- Currently, this benefit is available only for loans from banks and notified financial institutions.
