Clarification: The misclassifications, if any, will have to be reduced from the achievement of PSLC seller bank only. There will be no risk for the PSLC buyer, even if the underlying asset of the traded PSLC gets misclassified.

Clarification: There will be a real time settlement of the matched premium. Accordingly, the respective current accounts of the participating banks with RBI will be debited/ credited to the extent of the matched premium.

Clarification: The trading platform will match the buy and sell offer by following the Rule of Lowest Sale offer to the Buy offer and then within that on FIFO basis. For example, a buyer offered to pay 2% premium for a particular PSLC type and the same is available at 1.5%, 1.8% and 2%, the portal will first match with the sale deal at 1.5% and for any leftover units, it will then match with the sale offers of 1.8% and then 2% in that order, provided the buy offer is first in the queue (based on the timing of the placement of the buy offer).

Clarification: The order matching will be done on anonymous basis through the portal and the buyer/seller cannot select the counterparty. Partial matching will happen depending on the matching of premium and availability of category-wise PSLC lots for sale and purchase.

Clarification: The normal trading hours shall be from 10 AM to 4:30 PM. The PSLC market operates on all days except Saturdays, Sundays and holidays declared under The Negotiable Instruments Act, 1881 by the Government of Maharashtra.

Clarification: Paras 22, 23 and 24 of the Master Directions on Priority Sector Lending, 2025 permit banks to classify as PSL their lending to NBFCs including HFCs and NBFC-MFIs and other MFIs (Societies, Trusts etc.) which are members of RBI recognised SRO for the sector, for on-lending to eligible priority sectors. Banks may adopt a uniform methodology for PSL classification of on-lending as follows:

a) Classification under PSL:

• The banks can classify on-lending to eligible entities in the respective categories of PSL. The classification will be allowed only when the entity has disbursed the Priority Sector Loans to the ultimate beneficiary after receiving the funds from the bank and the funds remain deployed in PSL assets.

• The entities must provide auditors’ certificate to the banks stating that the individual loans of the portfolio, against which on-lending benefit is being claimed, are not being used to claim benefit from any other bank(s). Also, they must put in place a suitable process to flag such loan(s) in their systems to enable internal/statutory auditors as well as RBI supervisors (in case of NBFCs) to verify the same.

b) Information sharing:

• The banks may devise internal control mechanisms to ensure that the portfolio under on-lending is PSL compliant. The following information/record, at the very minimum, should be collected by the bank from the eligible entities:name of the beneficiary, amount sanctioned, loan amount outstanding, loan tenure, disbursement date, category of PSL.

Clarification: Bank lending to NBFCs (other than MFIs) and HFCs is subject to a cap of 5% of average PSL achievement of the four quarters of the previous financial year. In case of a new bank the cap shall be applicable on an on-going basis during its first year of operations. The prescribed cap is not applicable for bank lending to NBFC-MFIs and other MFIs (Societies, Trusts, etc.) which are members of RBI recognised ‘Self-Regulatory Organisation’ of the sector. Bank lending to such MFIs can be classified under different categories of PSL in accordance with conditions specified in the Master Directions on Priority Sector Lending, 2025.

Clarification: While the guidelines allow sharing of risks and rewards between the bank and the NBFC for ensuring appropriate alignment of respective business objectives, the priority sector assets on the bank’s books should at all times be without recourse to the NBFC.

Clarification: Only if the bank can exercise its discretion regarding taking into its books the loans originated by NBFC as per the agreement, the arrangement will be akin to a direct assignment transaction. If the Agreement entails a prior, irrevocable commitment on the part of the bank to take into its books its share of the individual loans as originated by the NBFC, it shall not be akin to direct assignment transaction.

Clarification: Both entities, the bank and the NBFC, shall be guided by the bilateral Master Agreement entered by them for implementing the Co-lending Model (CLM). The agreement may specify any cap on the number and amount of loans that can be originated by the NBFC under the Co-lending model.

Clarification: If the Master Agreement entails a prior, irrevocable commitment on the part of the bank, it has been advised that the partner bank and NBFC shall have to put in place suitable mechanisms for ex-ante due diligence by the bank. Such due diligence should ensure compliance with RBI regulations on KYC and outsourcing of activities before disbursal of the loans by the NBFC.

Clarification: Back-to-back basis implies that the loans will be first opened by NBFC and then bank will open loan accounts subsequently.

Clarification: The bank and the NBFC can decide on this aspect as per the Master agreement between them.

Clarification: The shortfall/excess in achievement is calculated for each quarter of the financial year. The shortfall/ excess for the year is arrived at by taking a simple average of the shortfall/excess for all the four quarters. In case of shortfall in achievement of overall PSL target or any of the prescribed sub-targets, the bank will be required to contribute to specified funds maintained with NABARD/SIDBI/MUDRA/NHB.

Ans: The survey collects details of portfolio investment assets of domestic residents made in securities issued by unrelated non-residents i.e., securities issued by unrelated non-residents and owned by residents.

11.1 For every transaction entered into by the trading desk, a deal slip should be generated which should contain data relating to nature of the deal, name of the counter-party, whether it is a direct deal or through a broker (if it is through a broker, name of the broker), details of security, amount, price, contract date and time and settlement date. The deal slips should be serially numbered and verified separately to ensure that each deal slip has been properly accounted for. Once the deal is concluded, the deal slip should be immediately passed on to the back office (it should be separate and distinct from the front office) for recording and processing. For each deal, there must be a system of issue of confirmation to the counter-party. The timely receipt of requisite written confirmation from the counter-party, which must include all essential details of the contract, should be monitored by the back office. The need for counterparty confirmation of deals matched on NDS-OM will not arise, as NDS-OM is an anonymous automated order matching system. In case of trades finalized in the OTC market and reported on NDS-OM reported segment, both the buying and selling counter parties report the trade particulars separately on the reporting platform which should match for the trade to be settled.

11.2 Once a deal has been concluded through a broker, there should not be any substitution of the counterparty by the broker. Similarly, the security sold / purchased in a deal should not be substituted by another security under any circumstances.

11.3 On the basis of vouchers passed by the back office (which should be done after verification of actual contract notes received from the broker / counter party and confirmation of the deal by the counter party), the books of account should be independently prepared.