RBI pushes crisis-hit NBFCs to maintain more high-quality liquid assets

All NBFCs must have contingency funding plans for responding to severe disruptions

The Reserve Bank of India (RBI) on Friday said from April 1 next year large non-banking financial companies (NBFCs) should maintain a liquidity coverage ratio (LCR) in line with banks and carry enough collateral that can be used for liquidity needs.

Even as the draft offered no hint of a possible liquidity window for the troubled NBFC sector, the central bank said it remained “committed to promote a robust, vibrant and well-functioning NBFC sector”.

“An NBFC should have sufficient collateral to meet expected and unexpected borrowing needs and potential increases in margin requirements over different timeframes,” the RBI said in a draft