RBI Removes Ceiling on Loans Against Listed Corporate Bonds
Why in the news
RBI scrapped the cap on bank credit secured by listed corporate bonds, so investors can raise funds without selling and the bond market gains depth.
Key facts
| Item | Earlier | Now |
|---|---|---|
| Loan against listed corporate debt securities | ₹20 lakh | No ceiling |
| Loan against shares, per person | ₹20 lakh | ₹1 crore |
| IPO financing, per person | ₹10 lakh | ₹25 lakh |
Who benefits
- HNIs, family offices, treasuries and institutions get easier credit.
- AAA, AA+ and AA- rated bonds should benefit first because of high credit quality.
Exam angle
- Old cap on loans against corporate debt: ₹20 lakh.
- Aim: liquidity.