Banks’ could see healthy demand for corporate credit as the RBI plans to allow them to finance domestic acquisitions and withdraw a framework introduced in 2016 that disincentivised lending by them to specified large borrowers.

Domestic acquisitions by India Inc could get a leg-up as RBI is planning to put in place an enabling framework for Indian banks to finance them.

overseas acquisitions

Currently, banks can only support overseas acquisitions of Indian companies. To improve the flow of credit and expand the scope of capital market lending by banks, RBI Governor Sanjay Malhotra said the central bank plans to provide an enabling framework for Indian banks to finance acquisitions by Indian corporates.

CS Setty, Chairman, State Bank of India, and Chairman, Indian Banks’ Association, sa

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