RBI issues capital rules to match borrower risk April 2027
The Reserve Bank of India just rolled out fresh guidelines on how much capital banks need to set aside for different types of loans, starting April 2027.
The big idea? Make sure banks' risk calculations actually match the real risk of who they're lending to, so safer borrowers don't get lumped in with riskier ones.
Eligible loans receive 75% risk weight
Loans to individuals and small businesses (with turnover up to ₹500 crore and exposure up to ₹10 crore) can now get a 75% risk weight, but only if they meet certain criteria: think home, education, or small business loans.
Unsecured personal loans and overdue credit card bills won't get this benefit and will face stricter terms.
For housing loans, the new rules link charges to your loan-to-value ratio; basically, the more you borrow compared to your property value (or if you have multiple housing loans), the higher your charges could be.
On the bright side: pay off your credit card by the due date, and banks face lower capital requirements, which could mean better deals for responsible spenders down the line.