RBI Governor Sanjay Malhotra announces the first bi-monthly monetary policy, in Mumbai, Wednesday
The Reserve Bank of India (RBI) announced a significant expansion of its co-lending framework, which was previously limited to arrangements between banks and NBFCs for priority sector loans only. The new policy will extend co-lending arrangements to all regulated entities and all loan categories.
This expansion aims to leverage the untapped potential of co-lending partnerships across India’s financial ecosystem. The move comes alongside the RBI’s decision to cut the repo rate by 25 basis points to 6 per cent, and shift to an accommodative monetary policy stance.
Industry leaders have responded positively to the policy changes. Arvind Kapil, Managing Director & CEO of Poonawalla Fincorp, called it a “mature and forward-looking move” that will help “deepen credit access and drive inclusive growth.” Pranay Aggarwal, Director & CEO of Stoxkart, highlighted that rate-sensitive sectors, including NBFCs, stand to benefit from the accommodative stance.
Despite the favourable policy announcement, NBFC stocks showed a downward trend in mid-day trading. Bajaj Finance fell 1.95 per cent, Shriram Finance declined 1.49 per cent, and Mahindra & Mahindra Financial Services dropped 1.43 per cent. Aditya Birla Capital was the only exception, trading marginally higher at 0.26 per cent.
The expanded co-lending framework is expected to create new opportunities for collaboration between different financial institutions, potentially increasing credit flow to various sectors of the economy, beyond the priority segments.
Published on April 9, 2025
