meta_id 3114555

On April 29, 2026, the Reserve Bank of India (RBI) issued the Reserve Bank of India (Non-Banking Financial Companies – Credit Risk Management) Second Amendment Directions, 2026 (RBI/2026-27/71). The amendment modifies the existing credit risk management framework applicable to non-banking financial companies (NBFCs) operating in India. The RBI, exercising powers conferred under sections 45JA, 45L and 45M of the Reserve Bank of India Act, 1934; sections 30A and 32 of the National Housing Bank Act, 1987; and section 3 read with sections 31A and 6 of the Factoring Regulation Act, 2011, introduced a new requirement for credit assessments conducted by NBFCs. The amendment inserts a new Paragraph 8A into the existing directions, requiring NBFCs to suitably factor in the possible impact of calamities on borrowers who may be impacted by such events when conducting credit assessments. This amendment reflects the RBI's focus on strengthening risk management practices among NBFCs by ensuring that credit evaluation processes account for potential disruptions arising from calamities and their impact on borrower capacity to service debt obligations. The requirement applies to all NBFCs regulated under the RBI's framework, including housing finance companies and factoring companies. The amendment comes into force with effect from July 1, 2026, providing NBFCs with a transition period to align their credit assessment procedures and systems with the new requirement.