What changed
The definition of 'infrastructure loan' under the NBFC Prudential Norms Directions, 2007 has been amended to include three new sub-sectors: capital dredging under ports, slurry pipelines under water and sanitation, and telecommunication and telecom services under communication. These additions follow government notifications dated April 5, 2013 and May 9, 2013.
What it means for you
NBFCs can now classify lending to these new sub-sectors as infrastructure loans, which may qualify for preferential treatment under prudential norms. This expands the scope of eligible infrastructure financing, potentially increasing lending opportunities in ports, pipeline transport, and telecom infrastructure.
What you must do
- Update internal loan classification systems to include the three new sub-sectors as infrastructure lending.
- Review existing loan portfolios to identify any exposures that now qualify as infrastructure loans.
- Ensure compliance with the revised definition in all new credit facilities from the effective date.
- Train credit and risk teams on the expanded sub-sector list for accurate reporting.
Who it affects
All NBFCs engaged in infrastructure lending, NBFC credit and risk management teams, Borrowers in capital dredging, slurry pipelines, and telecom services
What are the new sub-sectors added to infrastructure lending?
Capital dredging under ports, slurry pipelines under water and sanitation, and telecommunication and telecom services under communication.
When does this amendment take effect?
The amendment is effective immediately from the date of the circular, August 2, 2013.
Does this change apply to all NBFCs?
Yes, the circular is addressed to all NBFCs and amends the definition in the NBFC Prudential Norms Directions, 2007.