Non-banking financial companies (NFBCs) have requested the Reserve Bank of India to reconsider the increase in risk weights for bank loans to NBFCs. The RBI increased these weights by 25 percentage points to 125% on retail loans, potentially reducing credit flow to MSMEs and self-employed sectors.
The Reserve Bank of India decided to increase the risk weight on the exposure of banks to consumer credit, credit card receivables and non-banking finance companies.