All India Financial Institutions Credit Facilities Amendment Directions

RBI/2026-27/113 DOR.CRE.REC.93/07.01.007/2026-27 June 10, 2026

Reserve Bank of India (All India Financial Institutions – Credit Facilities) Amendment Directions, 2026

Please refer to the Reserve Bank of India (All India Financial Institutions – Credit Facilities) Directions, 2025 (hereinafter referred to as ‘ Directions ’).

2. On a review, and in exercise of the powers conferred by Section 45L of the Reserve Bank of India Act, 1934 and all other provisions / laws enabling the Reserve Bank of India in this regard, the Reserve Bank of India, being satisfied that it is necessary and expedient in public interest so to do, hereby, issues the Amendment Directions hereinafter specified.

3. The Amendment Directions modify the Directions as under:

3(1) In ‘Chapter VI – Other Instructions on Credit Facilities’ of the Directions, paragraphs 123 to 126 shall be deleted.

3(2) The following paragraphs shall be inserted under the sub-section ‘C.2 Lending to Infrastructure Investment Trusts (InvITs)’, namely:

“126A. AIFIs shall be permitted to lend to InvITs which are registered with and regulated by SEBI.

126B. General Conditions:

(i) An AIFI shall put in place a Board approved policy on lending to InvITs, which shall cover, inter alia, appraisal mechanism, sanctioning conditions, underwriting norms, including metrics such as the debt service coverage ratio (DSCR) and their corresponding benchmark levels, internal limits for individual exposures as well as the aggregate portfolio, and monitoring mechanisms, including stipulation of appropriate covenants. As the valuations of InvITs are primarily based on projected cash flows, an AIFI shall satisfy itself regarding the valuation methodology and the assumptions used for such valuations vis-à-vis AIFI’s own policy and relevant regulatory standards.

(ii) An AIFI shall ensure that the applicable legal provisions in respect of InvITs neither constrain the borrowing InvIT’s eligibility to borrow, nor restrict the AIFI’s ability to enforce their security interest and lender’s rights. Specifically, in cases where the InvIT is established as a trust, the AIFIs shall establish that the trust deed of the borrowing InvIT has relevant provisions for borrowings in the manner that is under consideration by the AIFI.

(iii) An AIFI shall strictly monitor the end use of funds lent to InvITs to ensure that this route is not being used to finance activities which are not directly permitted to be financed under the extant regulations.

(iv) An AIFI may lend only to an InvIT which is listed.

Explanation:

(1) Listed InvITs shall include InvITs under sub-regulations (2) and (4) of regulation 14 of the Securities and Exchange Board of India (Infrastructure Investment Trusts) Regulations, 2014.

Provided that in all cases, not less than 80 per cent of the value of the InvIT assets is invested in completed and revenue generating infrastructure projects and such assets have been generating positive cashflows from operations for a period of not less than one year.

(2) The term ‘completed and revenue generating project’ shall have the same meaning as assigned under the Securities and Exchange Board of India (Infrastructure Investment Trusts) Regulations, 2014, as amended from time to time.

(v) An AIFI shall ensure that lending to an InvIT is not used to fund its SPVs having existing loans from REs and which are facing financial difficulty, as defined in the Reserve Bank of India (All India Financial Institutions – Resolution of Stressed Assets) Directions, 2025 .

(vi) If the purpose of AIFI financing is refinancing of existing credit facilities of SPVs, then such refinancing shall be undertaken only in respect of credit facilities towards completed projects that have achieved commencement of commercial operations.

(vii) The credit facilities extended by an AIFI to an InvIT shall not involve bullet or ballooning repayment structures, so as to ensure that a disproportionate portion of principal repayments is not concentrated in the terminal phase of the loan tenure. However, this shall not preclude structuring the repayment schedule in line with projected cash flows.

Provided that, the above restriction shall not be applicable to exposures of an AIFI to an InvIT through its investment portfolio in the form of bonds, debentures, and commercial paper.

126C. Specific Provision for Acquisition Finance to InvITs:

(i) Without prejudice to the provisions of the Foreign Exchange Management Act, 1999 and the rules and regulations made thereunder, an AIFI may extend acquisition finance to an acquiring company, having infrastructure financing as its mandate, subject to the following conditions:

(ii) AIFI shall put in place a Board approved policy on acquisition finance, suitably incorporating the underwriting benchmarks that address the structural complexities of such transactions, in particular relating to exposure limits, equity contribution, leverage multiples, and cash-flow certainty.

(iii) Acquisition finance may be extended to acquire ‘control’, or to increase acquiring company’s stake towards acquiring ‘control’ over a non-financial infrastructure company as strategic investment – i.e., an investment driven by the core objective of creating long-term value for the acquirer through potential synergies, rather than mere financial restructuring for short-term gains.

Explanation: (a) For the purpose of this paragraph of the Direction, references to acquiring company shall mean the InvIT that would acquire shares in the target company, as the case may be.

Such acquiring company shall have a standalone as well as consolidated minimum net worth of ₹500 crore.

(c) ‘Control’ shall have the same meaning as defined in Section 2(27) of the Companies Act, 2013.

(iv) Acquisition finance can be extended:

(a) to the acquiring company for acquisition of target company directly by it; or

(b) to the acquiring company, for on-lending to a holding company, as defined in Securities and Exchange Board of India (Infrastructure Investment Trusts) Regulations, 2014, or a non-financial SPV for acquisition of a target company by such a holding company or SPV.

Explanation: For the purpose of this paragraph of the Direction, references to target company shall mean a non-financial infrastructure company.

(v) In cases where acquiring control in a target company leads to control over multiple companies due to control of such companies by the target company, the criteria of potential synergy must be suitably assessed considering all such companies.

Provided that, acquisition finance shall not be extended for acquisition of a non-financial target company, which has one or more financial entities as subsidiaries or Joint Ventures.

(vi) Acquisition finance may also be provided to refinance existing acquisition finance debt of an acquiring company, subject to compliance with the provisions of these Directions and prudential requirements as specified in paragraph 4(12) of Reserve Bank of India (All India Financial Institutions – Resolution of Stressed Assets) Directions, 2025 , at the time of refinance.

Provided that, refinance of acquisition finance can take place only when the acquisition finance has been concluded in all aspects, resulting in establishment of control of the target company by the acquiring company.

Provided further that, the refinance shall not be used for repayment of acquiring company’s contribution or for any purpose other than the retirement of the acquisition finance debt.

(vii) Credit assessment shall be conducted on a pro-forma consolidated basis, incorporating the financials of the acquiring company and the financials of the target company on a consolidated basis.

(viii) Total financing extended by the lenders for this purpose shall not exceed 75 per cent of the acquisition value, as independently assessed by the lenders as under:

(a) Listed Company: Valuation as determined by one independent valuer (to be appointed by the AIFI) as per para 8 (2) (e) of SEBI (Substantial Acquisition of Shares and Takeovers) Regulations, 2011 (‘SEBI SAST Regulations’) for valuing shares not frequently traded (using valuation parameters including, book value, comparable trading multiples, and such other parameters as are customary for valuation of shares of such companies);