The Reserve Bank of India (RBI) on November 28, 2025, issued the Reserve Bank of India (All India Financial Institutions – Securitisation Transactions) Directions, 2025.
The following has been stated namely: -
• It clarifies and strengthens the regulatory framework for pooling and transferring financial assets in India. It states that originators shall meet enhanced risk-retention and due diligence requirements, ensure proper valuation and disclosure of underlying assets, and adopt transparent accounting treatment consistent with international norms.
• It further mandates regular reporting of securitisation transactions, detailed disclosures to investors about underlying cash flows and collateral, and sets forth capital-charge levels based on the risk-grading of securitised tranches.
• The framework underlines the importance of homogeneity in asset pools, restricts certain adverse assets from inclusion, and places obligations on special purpose entities (SPEs) and originators to maintain robust governance and operational standards.
• This shall come into force from November 28, 2025.
[Notification no. - RBI/DOR/2025-26/328 DOR.STR.REC.247/21.04.177/2025-26]
