RBI has issued a circular for regulatory restrictions over loans and advances

Jul 29, 2021 | by Avantis RegTech Legal Research Team

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Finance & Taxation Compliance

The Reserve Bank of India (RBI) on July 26, 2021 has issued a circular for the loans and advances for regulatory restrictions. 

Unless sanctioned by the Board of Directors/Management Committee, banks should not grant loans and advances aggregating Rupees five crore and above to:

• any relative other than spouse (spouse as specified in para 2.2.1.3 above) and minor / dependent children of their own Chairmen/Managing Directors or other Directors.

• any relative other than spouse (spouse as specified in para 2.2.1.3 above) and minor / dependent children of the Chairman/Managing Director or other directors of other banks.

• any firm in which any of the relatives other than spouse (spouse as specified in para 2.2.1.3 above) and minor / dependent children as mentioned in (a) & (b) above is interested as a partner or guarantor.

• any company in which any of the relatives other than spouse (spouse as specified in para 2.2.1.3 above) and minor / dependent children as mentioned in (a) & (b) above is interested as a major shareholder or as a director or as a guarantor or is in control.

[Circular No. DOR.CRE.REC.No.33/13.03.00/2021-22]

 


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