The nameplate of the Reserve Bank of India on the building of the RBI museum in Kolkata (Photo: Shubhayan Bhattacharya/NDTV Profit) Show Quick Read Summary is AI Generated. Newsroom Reviewed

The Reserve Bank of India’s statement on Developmental and Regulatory Policies dated October 1, 2025, represents a significant regulatory development with far-reaching legal and commercial implications. By allowing banks to finance corporate acquisitions, subject to prudential norms, the RBI has addressed a long-standing gap in India’s credit ecosystem.

Previously, banks were largely prohibited from providing loans for equity acquisitions or leveraged buyouts. Such restrictions, grounded in concerns over asset-liability mismatches, concentration risk, and speculative use of deposit-based funds,

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