Summary: This article examines the legality of recent circulars issued by the Delhi government, which includes imposing a 0.1% stamp duty on dematerialised share issuances in Delhi (which is contrary to the centrally prescribed 0.005% rate).Continue Reading Demat Shares, Legal Snare: Delhi’s Stamp Duty Directives Examined
Summary: The Reserve Bank of India (RBI) has issued the Co-Lending Arrangements Directions, 2025, establishing a comprehensive regulatory framework for co-lending partnerships between regulated entities (REs). This framework significantly expands the scope beyond priority sector lending to cover all lending activities, while introducing key operational requirements, including a minimum 10% retention by each RE, mandatory transfer within 15 calendar days, blended interest rate calculations, and enhanced disclosure norms. The directions also introduce provisions for Default Loss Guarantee (DLG) up to 5% and unified borrower-level asset classification across partner REs, marking a substantial evolution from the previous 2020 framework.Continue Reading Analysis of RBI Co-Lending Arrangements Directions, 2025
Of India’s overall credit market, non-banking financial companies (“NBFCs”) command a 22% share[1], primarily catering to underserved sectors and providing retail loans, particularly to small businesses and households. As NBFCs have become systemically important for the economy, they have been subject to increased regulatory oversight by the Reserve Bank of India (“RBI”), evidenced by the introduction of scale-based regulations, which prescribe differential regulatory norms basis size and scale of the NBFC. This FIG paper explores the recent regulatory trends in this sector.Continue Reading FIG Paper (No. 42 – Series 1) – Regulatory Trends in NBFC Sector
Banks in India are often on the look-out for potential acquisition opportunities to spur inorganic growth. While their strategic interests will determine their targets, in recent times, banks have been evaluating acquisition of non-banking financial companies (“NBFCs”) and more specifically micro-finance institutions (“MFIs”), which primarily cater to the rural and
In our previous two FIG Papers of PA/PG Framework (here) and (here), we shared our key learnings in connection with operations of payment aggregator and payment gateway guidelines issued by the Reserve Bank of India (“RBI”) on March 17, 2020 (as amended from time to time) (“PA/PG Guidelines”).Continue Reading FIG Paper (No 35- Payments Series 3)– The new Draft Directions for Regulations of Payment Aggregator
In the current landscape, Indian banks are bound by data protection obligations under the provisions and rules of the Information Technology Act, 2000, the Prevention of Money Laundering Act, 2002 and relevant directives of the Reserve Bank of India (“RBI”). As we await the enforcement of the Digital Personal Data Protection Act, 2023 (“DPDP Act”) and the publishing of its rules (“DPDP Rules”), there will be a paradigm shift in the data processing protocols of banks amongst other financial entities.Continue Reading FIG Paper No. 28, Data Law Series 2: Implications of Digital Personal Data Protection Act, 2023 on Indian Banks
The Reserve Bank of India (“RBI”) recently issued instructions on practices to be adopted for charging penal interest/ charges on loans, vide its notification dated August 18, 2023, titled ‘Fair Lending Practice – Penal Charges in Loan Accounts’ (“Circular”).Continue Reading Fair lending practices on levy of penal charges
Central banks and other financial regulatory authorities are responsible for influencing major investment decisions and resource allocation through their policies. In India, the Reserve Bank of India (RBI) has joined a growing number central banks and financial regulators, who have incorporated climate change into their financial stability mandate seeking to frame prudential regulations and/or direct credit towards sustainable projects. We have analysed the recent developments in our previous posts available here and here.Continue Reading Green Central Banks and Financial Regulators – Are they Legally Mandated?
Section 138 of the Negotiable Instruments Act, 1881 (“NI Act”), ascribes criminal liability for dishonour of a cheque. The purpose of the provision has been held by the Hon’ble Supreme Court to be the promotion of efficacy of banking operations and to ensure credibility in transacting business through cheques.[i] Since a large number of such transactions and cheque payments are done by companies, the very same intent appears to be captured in Section 141 of the NI Act, which extends vicarious criminal liability on officers associated with the company or firm. The law on Section 141 of the NI Act has been clarified and elaborated upon from time to time. However, the broad principle guiding the extent of liability remains the involvement of the director concerned in the day-to-day business affairs of the company. This is, however, not a straight-jacket formula, and the nuances determining the extent of liability need to be examined closely.Continue Reading Directors’ Vicarious Liability under Current Legal Regime of Negotiable Instruments Act: An Analysis of Evolving Judicial Precedents