RBI issues draft amendment rules for securitisation notes

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RBI Securitisation Amended Rules

Highlights

RBI has issued four draft amendment directions on securitisation notes for public comments until August 27, 2026.
The proposed amendments will make the issuance and transfer process of SNs more transparent for commercial banks, small finance banks, NBFCs, and all-India financial institutions.
These changes will enhance regulatory clarity, the process of secondary transfers, and transparency in compliance for all participants in India's securitisation market.

This article was translated from the original. Read the original version by our correspondent here.

Draft framework for public comments

According to the press release from the Reserve Bank of India, the central bank has released four draft amendment directions for public comments, focusing on making the issuance and subsequent transfer of Securitisation Notes, or SNs, more efficient and transparent. The proposed amendments cover the Reserve Bank of India (Commercial Banks - Securitisation Transactions) Amendment Directions, 2026, Reserve Bank of India (Small Finance Banks - Securitisation Transactions) Amendment Directions, 2026, Reserve Bank of India (Non-Banking Financial Companies - Securitisation Transactions) Amendment Directions, 2026, and Reserve Bank of India (All India Financial Institutions - Securitisation Transactions) Amendment Directions, 2026.

The RBI has stated that comments on the draft guidelines are invited from the general public and other stakeholders until August 27, 2026. Feedback can be submitted via the 'Connect2Regulate' section link available on the Reserve Bank's website, or alternatively, it can be sent by post or email to the Chief General Manager, Credit Risk Group, Department of Regulation, Central Office, Reserve Bank of India, Mumbai.

Market liquidity and regulatory impact

This initiative is seen as a regulatory step towards streamlining the secondary transfer mechanism in India's securitisation market. If the draft amendments are implemented, they could bring greater clarity to the issuance and trading process of SNs for various regulated entities.

The scope of the proposed changes spans both banking and non-banking segments, indicating that the RBI aims to develop a more uniform framework for securitisation transactions across the entire financial system. This is likely to enhance transparency in compliance and transaction processes for investors, originators, and other market participants.

Our previous report discussed the rebalancing of Nifty Fixed Income Benchmarks effective from July 31, 2026 and the addition, removal, and weight changes of securities in various G-Sec and debt sub-indices under them. That article explained how such index changes can impact portfolio rebalancing, tracking strategies, and the structure and duration profile of passive debt investment products.

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