In a move to ease fundraising through external commercial borrowings (ECB), the Reserve Bank of India proposed a framework on Friday to link corporate fundraising limits from abroad to financial strength and scrapped cost caps. This is part of the easing of banking regulations that RBI Governor Sanjay Malhotra announced on Wednesday.

Tying borrowing power to financial strength

The regulator proposed to link the borrowing limit with the financial strength of the borrower. Under the proposed guidelines, a company can raise ECBs up to $1 billion or 300% of net worth as per the last audited balance sheet, whichever is higher. Earlier, borrowers were able to raise ECBs up to $750 million in a financial year.

Eased norms for costs, maturity, and eligibility

The central bank also proposed

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