The Reserve Bank of India (RBI) on December 04, 2025, issues amendment Directions for Repeal of Market Mechanism Framework.
The Reserve Bank of India (RBI) had issued draft guidelines on October 1, 2025, proposing the repeal of the 2016 instructions on enhancing credit supply for large borrowers through a market mechanism. After examining stakeholder feedback on the draft Repeal Circular, RBI has decided to withdraw these earlier instructions, which had been consolidated into the 2025 Concentration Risk Management Directions for commercial banks and small finance banks.
To implement this, RBI has issued multiple Amendment Directions for commercial banks and small finance banks covering concentration risk management, income recognition and asset classification, and capital adequacy norms. These amendments formally repeal the earlier credit-supply guidelines.
The objective of the new Amendment Directions is to recalibrate prudential requirements in light of a stronger regulatory framework, enhanced supervisory oversight, and the improved financial position of banks.
[Press Release: 2025-2026/1629]
