Rules / regulations / directions
RBI (NBFC – Prudential Norms on Capital Adequacy) Directions, 2025
Reviewed by CA Nikhil Gupta · Last reviewed 18 September 2026
Reserve Bank of India thematic NBFC capital-adequacy framework; current version must be selected by date, category and SBR layer.
Scope, legal role and applicability
Thematic prudential-capital framework. It operationalises capital adequacy and related prudential requirements by NBFC category/layer and should be read with Section 45IA NOF and Sections 45IB/45IC rather than replacing them.
Operative requirements
- Determine the applicable NBFC category/layer before selecting capital-ratio and composition rules.
- Calculate eligible capital using the Direction’s Tier/classification and deduction rules; do not use accounting net worth as a substitute.
- Apply risk weights/exposure treatment and any additional buffers or leverage requirements applicable to the category.
- Keep Section 45IA NOF, Section 45IB asset maintenance and Section 45IC statutory reserve fund as distinct tests.
- Recompute capital after material losses, distributions, acquisitions or reclassification events instead of relying only on the year-end ratio.
Records, forms and annexures
Preserve regulatory capital computation, audited numbers/reconciliations, risk-weight/exposure workings, Board review and returns submitted to RBI under the applicable reporting framework.
Practical advisory example
Facts and issue. An NBFC meets the minimum NOF under Section 45IA but its capital adequacy ratio falls below the applicable Direction. The two tests are separate; meeting NOF does not cure a prudential-capital breach.
Working method. Classify the entity/product, identify the exact paragraph in force on the event date, test exceptions and transitional provisions, then retain the evidence listed above. Do not rely on the title of the Direction or an old Master Direction version.
RBI Act / cross-law linkage
Official source and version control
Questions and answers
What is the main purpose of RBI (NBFC – Prudential Norms on Capital Adequacy) Directions, 2025?
Reserve Bank of India thematic NBFC capital-adequacy framework; current version must be selected by date, category and SBR layer.
Which part of RBI (NBFC – Prudential Norms on Capital Adequacy) Directions, 2025 should be checked first?
Start with capital definition and deductions and then apply this requirement: Start with Section 45IA NOF and Section 45IC reserve fund, then apply category-specific prudential capital measures.
What record should be retained?
Capital computation, audited financials and RBI returns/annexures required for the NBFC category form the evidence set.
Does this page treat the RBI Act as the only enabling law?
No. Current thematic prudential capital framework, issued under section 45L and allied statutes and amended in 2026.