Reserve Bank of India Issues Fifth Amendment Directions, 2026 on Prudential Norms on Capital Adequacy for AIFIs

Key facts

• The Reserve Bank of India (RBI) issued the Reserve Bank of India (All India Financial Institutions (AIFIs) – Prudential Norms on Capital Adequacy) Fifth Amendment Directions, 2026 on October 07, 2026, effective from the date of issue.
• The amendment was issued under Section 45L of the Reserve Bank of India Act, 1934, to align the Directions with international standards.
• Where an AIFI acts as a clearing member of a Qualified Central Counterparty (QCCP) for its own purposes, a risk weight of 2 per cent applies to its trade exposure to the QCCP for OTC derivatives, exchange traded derivatives, and securities financing transactions (SFTs).
• The 2 per cent risk weight also applies where the clearing member AIFI offers clearing services to clients and is obligated to reimburse the client for losses if the QCCP defaults.
• The amendment modifies paragraph 77(6)(i) of the Reserve Bank of India (AIFIs – Prudential Norms on Capital Adequacy) Directions, 2025, relating to the requirement for clearing member financial institutions to obtain legal opinion.