What changed
The Reserve Bank of India has amended the prudential norms on capital adequacy for payments banks. The amendments include changes to the add-on factors for market-related off-balance sheet items and the risk weight for trade exposure to qualified central counterparties. The updated norms aim to provide greater clarity and align with international standards.
What it means for you
The updated norms will impact payments banks' capital requirements and risk management practices. Banks will need to reassess their capital adequacy and adjust their risk management strategies to comply with the new norms. This may lead to increased capital requirements for some banks, which could affect their lending capabilities and profitability.
What you must do
- Review current capital adequacy ratios
- Assess impact of updated add-on factors on off-balance sheet items
- Adjust risk management strategies to comply with new norms
Who it affects
Payments banks, Lenders, Risk managers
What are the key changes to the prudential norms?
The amendments include changes to add-on factors for market-related off-balance sheet items and the risk weight for trade exposure to qualified central counterparties.
When do the updated norms come into effect?
The updated norms come into effect from the date of issue, March 10, 2026.