Policy Context and Objectives The Reserve Bank of India has issued draft “Commercial Banks – Capital Market Exposure (CME) Directions, 2025” proposing consolidated, risk-sensitive limits on banks’ direct and aggregate exposures to capital markets, with phased implementation envisaged from April 1, 2026 subject to finalisation. The draft CME framework seeks to rationalise and unify disparate…
In a move to simplify immigration and enhance digital compliance, the Government of India has introduced mandatory online submission of the Electronic Arrival (e-Arrival) Card for all foreign nationals and Overseas Citizens of India (OCI) cardholders traveling to India. This update supports India’s ongoing initiative toward paperless and tech-enabled border processes. Key Requirement From 1…
Education loans in India finance tuition, living expenses, travel, equipment, and exam fees for eligible courses in India and abroad, delivered primarily by banks/NBFCs with government-backed interest subsidy and targeted schemes for specific communities and income groups. Policy framework Loan types Eligibility Loan quantum and coverage Interest rates and concessions Security, margin, and co-borrowers…
The Vidya Lakshmi Portal is a government-run, single-window platform designed to help students access education loans and government scholarships in one place. It streamlines the process of applying for multiple loan schemes across various banks, ensuring transparency and convenience for aspiring students. The Pradhan Mantri Vidyalaxmi (PM-Vidyalaxmi) Scheme, accessed through this portal, specifically offers collateral-free…
Liquid funds and ultra-short term funds are both SEBI-defined debt mutual fund categories designed for short horizons, but they differ mainly in portfolio duration, liquidity mechanics, risk-return profile, and use-cases for treasury and personal cash management. Definitions and portfolio Investment horizon Liquidity and redemption Risk sensitivity Return potential and volatility Costs and loads Operational…
The Central Sector Interest Subsidy Scheme (CSIS) is a Government of India initiative aimed at supporting students from the Economically Weaker Sections (EWS) to pursue technical and professional education in India. Key updates include a maximum subsidy on loans up to ₹10 lakh, a parental income ceiling of ₹4.5 lakh annually, and applications submitted via…
[The working capital requirement of industrial and trading establishments means the sum of the funds invested by them in various current assets (like raw material (RM), work in process (WIP), finished goods (FG), and the outstanding receivables on goods sold. The working capital facility is extended to a borrower by the banks will depend upon on…
The Statutory Liquidity Ratio (SLR) requires banks to hold a minimum share of Net Demand and Time Liabilities in liquid assets such as cash, gold, and government securities, shaping banks’ balance sheets, credit supply, and interest rates while supporting financial stability and government debt markets. A higher SLR restrains bank lending capacity and can firm…
The Cash Reserve Ratio (CRR) is a core liquidity tool of the Reserve Bank of India (RBI) that directly alters banks’ lendable resources, influences interest rates and credit growth, and transmits into inflation and output dynamics in the wider economy. Higher CRR tightens liquidity and credit conditions, while lower CRR releases primary liquidity, supporting credit…
The deregulation of interest rates refers to the removal of government-imposed controls on the rates financial institutions charge or offer on loans and deposits. This shift enables banks and other institutions to independently set their interest rates, fostering a more competitive financial environment. The primary objectives of such deregulation include enhancing market efficiency, improving the…
