State-run Rural Electrification Corporation today said the Reserve Bank has granted it the infrastructure finance company status which would allow the firm to lend more to power projects.
The Reserve Bank of India (RBI) has now categorised the Rural Electrification Corporation Limited as an Infrastructure Finance Company (IFC), REC said in a statement.
REC is into financing power generation, transmission and distribution projects in the country.
With IFC status, REC can now take an additional lending exposure of up to 5 per cent of its owned funds in case of a single borrower and up to 10 per cent of its owned funds in case of a group of borrowers.
The total permissible exposure would thus be 40 per cent of owned funds in case of a group of borrowers.
REC also becomes eligible for issuance of infrastructure bonds and for raising funds up to $500 million (Rs 2,500 crore approximately) through external commercial borrowing (ECB) in a year.
REC is the second company after Power Finance Corp (PFC) to be accorded the status of IFC by the Reserve Bank. PFC was accorded the status in July this year.
You’ve reached your limit of {{free_limit}} free articles this month.
Subscribe now for unlimited access.
Already subscribed? Log in
Subscribe to read the full story →
Smart Quarterly
₹900
3 Months
₹300/Month
Smart Essential
₹2,700
1 Year
₹225/Month
Super Saver
₹3,900
2 Years
₹162/Month
Renews automatically, cancel anytime
Here’s what’s included in our digital subscription plans
Exclusive premium stories online
Over 30 premium stories daily, handpicked by our editors
Complimentary Access to The New York Times
News, Games, Cooking, Audio, Wirecutter & The Athletic
Business Standard Epaper
Digital replica of our daily newspaper — with options to read, save, and share
Curated Newsletters
Insights on markets, finance, politics, tech, and more delivered to your inbox
Market Analysis & Investment Insights
In-depth market analysis & insights with access to The Smart Investor
Archives
Repository of articles and publications dating back to 1997
Ad-free Reading
Uninterrupted reading experience with no advertisements
Seamless Access Across All Devices
Access Business Standard across devices — mobile, tablet, or PC, via web or app