RBI caps loans against shares and IPO subscriptions
→System-wide borrowing limits imposed for individuals
Change
India’s RBI capped loans against shares at ₹1 crore per borrower system-wide and IPO/ESOP financing at ₹25 lakh per individual.
Why it matters
Banks must monitor aggregate borrower exposure across institutions and enforce limits to prevent excessive leveraged positions.
Implications
- → Banks must track system-wide exposure — compliance complexity increases
- → Borrowers face stricter limits — leverage reduced
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Source
View on Economic Times