RBI asks banks to give due notices to customers for periodic KYC update

In a circular, the RBI said it has observed a large pendency in periodic updation of KYC, including in the accounts opened for credit of Direct Benefit Transfer (DBT)/ Electronic Benefit Transfer (EBT) under government schemes to facilitate credit of DBTs and/or scholarship amount (DBT/EBT/scholarship beneficiaries) and accounts opened under PMJDY.

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News18

an hour ago

• News18

PM Kisan 20th Installment Date: Complete These 4 Tasks To Avoid Missing The Upcoming Tranche Of Rs 2,000

If you're a PM Kisan beneficiary, it's crucial to complete certain mandatory formalities in time to ensure your payment is not withheld. Here are the four key things you must check and fix to avoid delays in receiving your Rs 2,000 installment: 1. Link Aadhaar with Your Bank Account The government disburses the PM Kisan amount through the Aadhaar-seeded Direct Benefit Transfer (DBT) system. Make sure your bank account is correctly linked to your Aadhaar number. If not, visit your bank or update it online to avoid payment failure. 2. Complete Your e-KYC e-KYC (Electronic Know Your Customer) is mandatory for all PM Kisan beneficiaries. Without it, your name may be dropped from the beneficiary list. You can complete e-KYC in three simple ways: OTP-Based e-KYC: If your Aadhaar is linked to your mobile number, visit PM Kisan's website and verify using the OTP. Biometric e-KYC: Visit your nearest Common Service Centre (CSC) for fingerprint authentication. Facial Authentication: A special facility for senior citizens and physically challenged farmers is now available at CSCs, allowing e-KYC through facial recognition. As per the scheme's official website, 'eKYC is MANDATORY for PMKISAN Registered Farmers." 3. Get Your Land Records Verified Eligibility for PM-KISAN is based on land ownership. If your land documents are not updated or not verified with the state revenue department, your application may be rejected or the next installment may be withheld. Many states like Uttar Pradesh, Madhya Pradesh, Bihar, and Rajasthan have launched farmer registry and land verification drives. Ensure your land records are digitised and linked with your Aadhaar and PM Kisan ID. 4. Check Your Application Status Online You can check whether your application is approved, rejected, or pending by visiting the official PM Kisan portal: Go to Click on 'Know Your Status' or 'Beneficiary Status' Enter your Aadhaar number, registration number, or mobile number It's also advisable to check the bank account details mentioned in your profile to correct any errors in name spelling, IFSC code, or account number. PM Kisan: When is the 20th Installment Expected? As per previous trends, PM Narendra Modi is likely to release the 20th installment of the PM Kisan scheme between June-end and early July 2025. Final Checklist for Farmers Aadhaar linked to bank account e-KYC completed Land ownership verified Name and bank details error-free on PM Kisan portal If you meet all these conditions, you should receive your Rs 2,000 installment without any issues once the 20th tranche is released. Who Is Eligible for PM Kisan? How To Apply For PM Kisan Samman Nidhi?

Time of India

2 hours ago

• Time of India

NBFC-MFIs get to cast net wider: Lower qualifying asset threshold supportive; recovery processes, technology adoption key

It is now time the sector, an essential pillar of financial inclusion and economic development, overhauls its playbook. (AI image) By Binaifer Jehani and Abbas Master The recent move by the Reserve Bank of India (RBI) to relax the qualifying asset norm of non-banking financial companies-microfinance institutions (NBFC-MFIs) promises to address several challenges bogging down the sector. Primarily, it enables MFIs to diversify asset allocation by assigning a greater proportion of their resources to products and services that extend beyond traditional microfinance. It gives NBFC-MFIs the flexibility to adjust without the fear of any regulatory repercussions. How the revised regulation benefits NBFC-MFIs: Strengthens financial stability by improving risk mitigation: By reducing reliance on microfinance loans, NBFC-MFIs are better placed to withstand market turbulence Boosts regulatory adherence: The regulation addresses the reasons that led to non-compliance among non-banking financial companies, microfinance institutions. Further, If NBFC-MFI is unable to maintain the revised threshold for four consecutive quarters, they need to submit a remediation plan to the RBI, outlining the steps taken to rectify the situation Unlocks new growth avenues: NBFC-MFIs can boost profitability by offering specialised products to clients transitioning to small and medium-sized enterprises, micro-housing and other such new segments MFIs in India already serve more than 7 crore (70 million) unique borrowers, with the majority being women in rural areas. Though the sector plays a vital role by providing marginalised households and micro-entrepreneurs access to credit and other financial services, it faces challenges such as lack of product diversification. The RBI's move to reduce the qualifying asset (net of intangible assets) threshold from 75% to 60% provides NBFC-MFIs the flexibility to diversify operations by giving credit to more segments and to improve financial stability. by Taboola by Taboola Sponsored Links Sponsored Links Promoted Links Promoted Links You May Like Memperdagangkan CFD Emas dengan salah satu spread terendah? IC Markets Mendaftar Undo Coming on the back of the MFIN guardrails rolled out recently, the latest directive will enable NBFC-MFIs to maintain a more balanced portfolio. It also reduces their dependence on microfinance loans — which is high, making them vulnerable to asset quality risks and funding constraints — thereby helping them derisk their portfolios and improve their financial health. Besides, it will give them more room to manoeuvre and respond to changing market conditions. What the sector should do now It is now time the sector, an essential pillar of financial inclusion and economic development, overhauls its playbook. A shift towards digital integration, better risk management and customised credit products is necessary for MFIs to improve their reach and service. Digital integration can be particularly helpful to resolve an issue that has been plaguing the sector for long: poor recovery practices. While a code of conduct establishes ethical standards that loan officers should follow to ensure transparency, accountability and integrity while dealing with customers, the use of technology can help MFIs reduce the dependence on human resources. Robust credit assessments using tech tools can also avoid over-leveraging by borrowers and prevent the use of coercive recovery methods. MFIs must integrate digital tools such as mobile applications, automated credit assessments and other verifications to streamline processes and reduce in-person interactions. By leveraging technology, MFIs can scale up operations without being constrained by workforce limitations, while also maintaining a balanced human touch — necessary to reach the marginalised populace. A balanced approach In conclusion, the relaxation of qualifying asset norms will help NBFC-MFIs promote financial inclusion in a much more effective manner and also provide stability to the microfinance sector. The revised regulation is expected to enable MFIs to diversify their operations and increase access to credit for marginalised communities. Of course, challenges such as collections, portfolio quality, recovery practices, technology adoption and risk management need to be addressed. As the sector continues to evolve, it is essential for regulators, industry players and stakeholders to work together to ensure that microfinance reaches the most vulnerable sections of society and promotes financial inclusion and economic well-being among them — an important step to drive the country's economic growth. To achieve these goal, the sector has to find a balanced way to use technology, human touch and adherence to regulatory framework. (Binaifer Jehani is Business Head, Risk Solutions – Assessments & Social Sector Consulting, Crisil Intelligence. Abbas Master is Associate Director, Risk Solutions – Assessments & Social Sector Consulting, Crisil Intelligence) Stay informed with the latest business news, updates on bank holidays and public holidays . AI Masterclass for Students. Upskill Young Ones Today!– Join Now

Business Standard

3 hours ago

• Business Standard

Motilal Oswal sector of the week: NBFCs; REC, PFC among top bets

India's NBFC sector has received much-needed regulatory clarity with the Reserve Bank of India (RBI) releasing its final guidelines on project finance, effective for loans sanctioned from 1st October 2025. The new framework, formulated after consultations with stakeholders including banks, NBFCs, and government bodies, is significantly softer than the earlier draft, especially with regard to provisioning norms for under-construction projects. One of the most critical aspects of the final guidelines is their non-retrospective nature. Under-construction projects that have already achieved financial closure will remain governed by the existing provisioning norms. This move ensures a seamless transition for lenders and protects existing loan books from sudden provisioning shocks. For new loans sanctioned on or after 1st October 2025, standard asset provisioning has been eased considerably. NBFCs are now required to set aside 1 per cent for standard under-construction project loans, including infrastructure and CRE-RH (commercial real estate - residential housing), and 1.25 per cent for under-construction CRE loans. Once projects reach the operational phase—i.e., repayment of principal and interest begins—the provisioning falls to 0.4 per cent for general project finance, 0.75 per cent for CRE-RH, and 1 per cent for CRE. To further support infrastructure and long-gestation projects, the RBI has allowed delays in the Date of Commencement of Commercial Operations (DCCO)—up to three years for infrastructure projects and up to two years for non-infrastructure projects, including CRE. However, additional specific provisions will be required during the deferment period: 0.375 per cent per quarter for infrastructure loans and 0.5625 per cent per quarter for non-infrastructure loans. These can be reversed once commercial operations begin. From a sectoral perspective, the impact on NBFCs is expected to be manageable. Large project financiers like PFC and REC already carry standard asset provisions in excess of 1 per cent, which cushions them from any meaningful hit. For others with exposure to project finance, the incremental provisioning burden may be partially passed on to borrowers through loan pricing, thus limiting the impact on profitability. In conclusion, the RBI's final guidelines are a well-balanced and constructive reform. They provide regulatory certainty, support infrastructure financing, and promote financial stability without being disruptive. For NBFCs, the new norms enhance visibility and strengthen the risk-reward framework in project lending. REC – Targte Price: ₹460 REC reported healthy performance in FY25, with a 5 per cent Y-o-Y profit after tax (PAT) growth in 4QFY25 supported by one-offs in interest income. While loan growth guidance has been revised to 12–13 per cent due to elevated prepayments, spreads improved 70bp Q-o-Q and NIMs remained steady at 3.63 per cent. Asset quality strengthened, with GS3 at 1.35 per cent and a target of net-zero NPAs by FY26. Under the revised RBI project finance guidelines, REC remains well cushioned with Stage 1 and 2 provisioning at 0.95 per cent. We model FY25–27 PAT CAGR of 11 per cent, RoA/RoE of 2.6 per cent/20 per cent, and a 5.7 per cent dividend yield by FY27. PFC – Target Price: ₹485 PFC delivered strong operational performance in FY25, with 20 per cent Y-o-Y PAT growth to ₹173.5b, driven by healthy disbursements, improved asset quality, and a ₹12b write-back from the KSK Mahanadi resolution. The final RBI guidelines on project finance are favorable, with lower provisioning norms and no retrospective application. PFC is well placed under the revised framework, with Stage 1 and 2 provisioning at 1.13 per cent as of Mar'25. We estimate an FY25–27 PAT CAGR of 8 per cent, RoA/RoE of 3 per cent/18 per cent, and a dividend yield of 5 per cent in FY27E. =========================