8 circulars simplified · plain language · compliance checklists · linked to source. Verified against official rbi.org.in.
RBI/2024-25/18
Borrower-friendly · Tightening on disclosureFair LendingDisclosure
Every LAP borrower must get a one-page 'Key Facts' sheet with the true all-in cost
TL;DRBanks must hand every LAP borrower a standardised one-page Key Facts Statement showing the real all-in cost (APR) before signing.
RBI/2023-24/53
Borrower-friendly · Revenue-restrictingFair LendingPenal Charges
Late-payment penalties become flat 'charges', not extra interest — and can't be compounded
TL;DROn default, lenders may levy a flat 'penal charge' but not 'penal interest' — and cannot compound it or treat it as a profit line.
RBI/2023-24/55
Borrower-friendly · Conduct-focusedFair LendingInterest Rates
When rates rise, floating-rate LAP borrowers must be offered fixed-rate switch, tenor/EMI choice and clear statements
TL;DROn every floating-rate EMI loan, lenders must flag rate-reset impact upfront, offer a fixed-rate switch and EMI/tenor choice, and send quarterly statements.
RBI/2025-26/64
Borrower-friendly · Pro-competitionFair LendingPre-payment
No pre-payment charges on floating-rate loans to individuals — foreclose or switch lenders free
TL;DRFrom 1 January 2026, lenders cannot levy pre-payment or foreclosure charges on floating-rate loans to individuals for non-business purposes — no lock-in, regardless of fund source.
RBI/2024-25/30
Borrower-friendly · Conduct correctionFair LendingInterest
Charge interest only from the date money actually reaches the borrower — not from sanction date
TL;DRLenders must charge interest only from the date funds actually reach the borrower, must not bill a full month for a part-month, and must not charge interest on instalments collected in advance.
RBI/2023-24/85
Tightening · CapitalCapital / BaselRisk Weights
Risk weight on unsecured consumer credit raised to 125% — but secured LAP is excluded
TL;DRRBI raised the risk weight on unsecured consumer credit to 125% and credit cards to 150% (banks) — but housing, education, vehicle, gold and secured property loans like LAP are excluded.
RBI/2019-20/53
Structural · TransmissionInterest RatesPricing
Floating-rate retail loans must be priced off an external benchmark (repo/T-bill), reset at least quarterly
TL;DRFrom October 2019, all new floating-rate retail and MSE loans must be linked to an external benchmark (repo rate or T-bill yield), with a uniform benchmark per loan category and a reset at least once every three months.
RBI/2021-22/125
Tightening · Recovery disciplineAsset ClassificationNPA
NPAs are tagged at day-end after 90 days overdue — and upgrade to 'standard' only after ALL arrears are cleared
TL;DRLoan accounts are flagged SMA/NPA at day-end based on continuous overdue days (NPA after 90), and an NPA can return to 'standard' only after the borrower clears the entire arrears of interest AND principal.