What changed
RBI inserted a new section 33A under Chapter IV of the Responsible Business Conduct Directions for AIFIs. This allows AIFIs to voluntarily offer relief like fee waivers or reductions to customers in areas where a calamity has been declared, for a maximum period of one year.
What it means for you
AIFIs now have explicit regulatory cover to provide fee relief during disasters without needing case-by-case approval. This aligns them with similar flexibility already available to banks, enabling faster customer support. Lenders must update their internal policies and systems to implement these discretionary measures from July 1, 2026.
What you must do
- Update internal policy manuals to include the new Section 33A on calamity relief measures.
- Train operational staff on identifying declared calamity areas and processing fee waivers or reductions.
- Ensure system readiness to apply fee relief for up to one year from the date of calamity declaration.
- Coordinate with government agencies to get timely notifications of official calamity declarations.
Who it affects
All India Financial Institutions (AIFIs), Customers in calamity-declared areas, Compliance and operations teams at AIFIs
Which AIFIs are covered by this amendment?
The amendment applies to all All India Financial Institutions (AIFIs) as defined under the RBI Act, including entities like NABARD, SIDBI, NHB, and EXIM Bank.
What types of fees or charges can be waived or reduced?
The direction does not specify exact fees, so AIFIs have discretion to waive or reduce any fees and charges they normally levy, such as processing fees, prepayment charges, or late payment penalties, for customers in calamity areas.
Is the relief mandatory or optional for AIFIs?
It is optional. The direction says an AIFI 'at its discretion, may provide' such relief measures. There is no compulsion to offer waivers.