The Daily Brief The RBI just silently made some huge moves
Oct 3, 2025
Recent actions by the RBI have stirred discussions on India's economic outlook. The pause on rate cuts raises questions about inflation and global uncertainties. With 22 regulatory reforms, including updates on deposit insurance and capital market lending, significant changes are underway. Microfinance faces challenges from rising repayment stress and borrower trends, yet there's cautious optimism for recovery. Additionally, the internationalization of the rupee is explored as new lending practices emerge, potentially redefining regional finance.
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Deposit Insurance Goes Risk-Based
- Deposit insurance will switch to risk-based pricing from next fiscal year to reward safer banks.
- The change creates direct financial incentives for better risk management across banks.
Capital Markets And Lending Limits Expand
- RBI opens capital-market lending: banks can now finance corporate acquisitions and larger loans against shares.
- It also removes the cap on lending against listed debt, boosting corporate bond market liquidity.
Limits On Large Borrowers Removed
- The RBI is scrapping the 2016 system-wide ceiling on lending to large borrowers.
- Instead, it will rely on bank-level large exposure rules and macroprudential tools to manage concentration risk.