{"id":27319,"date":"2018-10-23T13:10:10","date_gmt":"2018-10-23T07:40:10","guid":{"rendered":"https:\/\/blog.forumias.com\/?p=27319"},"modified":"2018-10-23T13:10:10","modified_gmt":"2018-10-23T07:40:10","slug":"rbi-announces-norms-for-co-origination-of-priority-sector-loans-by-banks-nbfcs","status":"publish","type":"post","link":"https:\/\/forumias.com\/blog\/rbi-announces-norms-for-co-origination-of-priority-sector-loans-by-banks-nbfcs\/","title":{"rendered":"RBI announces norms for co-origination of priority sector loans by banks, NBFCs"},"content":{"rendered":"<p><a href=\"https:\/\/www.livemint.com\/Industry\/h7AzPTJyBGp9rwmAfAfqPN\/RBI-announces-norms-for-coorigination-of-priority-sector-lo.html\">RBI announces norms for <strong>co-origination of priority sector loans<\/strong> by banks, NBFCs<\/a><\/p>\n<p><strong>News<\/strong><\/p>\n<ol>\n<li>RBI announced the co-origination model between banks and NBFCs.<\/li>\n<\/ol>\n<p><strong>What is co-origination of loans?<\/strong><\/p>\n<ol start=\"2\">\n<li>It is a proposal for joint lending by banks and NBFCs.<\/li>\n<\/ol>\n<ul>\n<li><strong>NBFC<\/strong>-A Non Banking Financial Company (<strong>NBFC<\/strong>) is a company registered under the Companies Act, 1956 of India, engaged in the business of loans and advances, acquisition of shares, stock, bonds, hire-purchase insurance business or chit-fund business.<\/li>\n<\/ul>\n<ol start=\"3\">\n<li>All <strong>scheduled commercial banks<\/strong> (excluding regional rural banks and small finance banks) may engage with <strong>non-banking financial companies to co-originate loans<\/strong> for the creation of priority sector assets.<\/li>\n<\/ol>\n<ul>\n<li>Priority sectors examples- agriculture loans, affordable housing, renewable energy projects, etc.<\/li>\n<\/ul>\n<p><strong><u>Important Facts:<\/u><\/strong><\/p>\n<ul>\n<li>The arrangement should entail <strong>joint contribution of credit<\/strong> at the facility level by both lenders.<\/li>\n<li>The risks and rewards will be shared between the banks and NBFCs.<\/li>\n<li>At least 20% of the credit risk will be on the NBFC\u2019s books and the balance will be on the bank\u2019s book till maturity.<\/li>\n<li>For fixed rate loan, single blended interest rate will be offered (A <strong>blended rate<\/strong> is an <strong>interest rate<\/strong> charged on a loan that represents the combination of a previous <strong>rate<\/strong> and a new <strong>rate<\/strong>)<\/li>\n<li>For floating interest loan, weighted average of benchmark interest rates of both bank and NBFC will be offered<\/li>\n<li>Tripartite agreement will be signed between bank, NBFC and customer<\/li>\n<li>The bank and NBFC will open a common account to pool loan contributions for disbursal and repayments<\/li>\n<\/ul>\n<p><strong>Benefits of co-origination of loans<\/strong><\/p>\n<ol start=\"4\">\n<li>Low-cost funds from banks and lower cost of operations from NBFC will be passed on to the beneficiary through weighted average rate.<\/li>\n<\/ol>\n","protected":false},"excerpt":{"rendered":"<p>RBI announces norms for co-origination of priority sector loans by banks, NBFCs News RBI announced the co-origination model between banks and NBFCs. What is co-origination of loans? It is a proposal for joint lending by banks and NBFCs. NBFC-A Non Banking Financial Company (NBFC) is a company registered under the Companies Act, 1956 of India,&hellip; <a class=\"more-link\" href=\"https:\/\/forumias.com\/blog\/rbi-announces-norms-for-co-origination-of-priority-sector-loans-by-banks-nbfcs\/\">Continue reading <span class=\"screen-reader-text\">RBI announces norms for co-origination of priority sector loans by banks, NBFCs<\/span><\/a><\/p>\n","protected":false},"author":61,"featured_media":0,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"jetpack_post_was_ever_published":false,"footnotes":""},"categories":[555],"tags":[],"class_list":["post-27319","post","type-post","status-publish","format-standard","hentry","category-test-1","entry"],"jetpack_featured_media_url":"","views":{"total":0,"cached_at":"","cached_date":1704703461},"jetpack_sharing_enabled":true,"_links":{"self":[{"href":"https:\/\/forumias.com\/blog\/wp-json\/wp\/v2\/posts\/27319","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/forumias.com\/blog\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/forumias.com\/blog\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/forumias.com\/blog\/wp-json\/wp\/v2\/users\/61"}],"replies":[{"embeddable":true,"href":"https:\/\/forumias.com\/blog\/wp-json\/wp\/v2\/comments?post=27319"}],"version-history":[{"count":0,"href":"https:\/\/forumias.com\/blog\/wp-json\/wp\/v2\/posts\/27319\/revisions"}],"wp:attachment":[{"href":"https:\/\/forumias.com\/blog\/wp-json\/wp\/v2\/media?parent=27319"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/forumias.com\/blog\/wp-json\/wp\/v2\/categories?post=27319"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/forumias.com\/blog\/wp-json\/wp\/v2\/tags?post=27319"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}