The Reserve Bank of India has published the Third Amendment Directions regarding income recognition and provisioning for Non-Banking Financial Companies, aiming to enhance operational standards.
RBI Revisions for Non-Banking Financial Companies
On July 16, 2026, the Reserve Bank of India released the Third Amendment Directions for Non-Banking Financial Companies (NBFCs), focusing on income recognition, asset classification, and provisioning.
The updated provisions stem from the prior amendments aimed at the resolution of stressed assets and are executed under sections 45JA, 45L, and other related regulations. The RBI seeks to tighten compliance measures to enhance operational transparency within the sector.
Legal professionals advising NBFCs must ensure their clients understand these amendments and adapt their internal controls accordingly to mitigate risks associated with non-compliance and uphold their financial responsibilities.
Citations
- Reserve Bank of India (Non-Banking Financial Companies Income Recognition, Asset Classification and Provisioning) Third Amendment Directions (2026)