NBFC Government Debt Exposure to Carry Nil Risk Weight: Reserve Bank

Mumbai: The Reserve Bank of India on Thursday said fund and non-fund based exposures to central government sovereign debt by non-banking finance companies (NBFCs) will carry no risk weight.

Similarly, exposures to central government guaranteed claims by NBFCs will have zero risk weight, the RBI said.

For direct loan or overdraft to state government securities, the risk weight will be nil, though for state government guaranteed claims, which have not defaulted, it will be 20 per cent, the central bank said in the circular.

For state government backed loans, which have remained in default for more than 90 days, will attract 100 per cent risk weight for NBFCs.