The Hindu Business Line : New window for NBFCs

In a bid to help non-banking financial companies (NBFCs) meet their fund requirements and maintain capital adequacy requirements, the Reserve Bank of India has allowed these companies to issue perpetual debt instruments (PDI) in Indian rupee to raise funds. The PDIs will be eligible for inclusion as Tier I Capital to the extent of 15 per cent of total Tier I capital of the company as on March 31 of the previous accounting year, RBI said in a notification issued on Wednesday. The amount of PDI, which is in excess of the amount allowed as Tier I capital, would qualify as Tier II capital. RBI has stipulated Rs 5 lakh as the minimum investment in each issue by a single investor. All NBFCs with an asset size of more than Rs 100 crore can raise funds by issuing PDI as bonds or debentures, but these funds would not be treated as public deposits, the notification said.- Our Bureau

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