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Tata Capital’s revolving credit exposure is below 5% of its overall credit exposure, according to managing director and CEO Rajiv Sabharwal. The company is preparing its feedback on the Reserve Bank of India’s draft proposal that seeks to restrict non-banking financial companies from offering revolving credit products and require credit facilities to follow a term-loan structure. Sabharwal said Tata Capital does not expect major concerns from the proposal at this stage, although the company is still assessing the possible impact. The RBI has invited feedback from regulated entities and stakeholders before finalising the framework.
Tata Capital’s exposure to revolving credit products is below 5%, and the non-bank lender will submit its feedback on the Reserve Bank of India’s proposed regulatory changes, managing director and chief executive officer Rajiv Sabharwal said.
The company is currently assessing the draft norms and is collating the relevant data before finalising its response to the central bank. Sabharwal said the share of revolving credit in Tata Capital’s overall exposure is small and that the company’s product offering is broader than this segment.
The comments come after the RBI proposed changes to the way non-banking financial companies offer credit. Under the draft norms issued last week, NBFCs would be required to offer credit products in the form of term loans and would not be permitted to offer revolving credit products.
Revolving credit allows borrowers to draw funds repeatedly up to a sanctioned limit, repay the amount and borrow again as required. Credit cards and personal lines of credit are common examples of such facilities.
Speaking to reporters on the sidelines of the FIBAC 2026 conference, Sabharwal said Tata Capital’s revolving credit exposure would remain below 5% and indicated that it was not a major part of the company’s lending portfolio. He also said the company would independently submit its views to the RBI after reviewing the proposed framework.
Sabharwal said it was too early to determine the final impact of the proposed regulations. The regulator has invited feedback from the industry, and Tata Capital is in the process of determining the specific points and parameters that will form part of its submission.
On whether the draft contained any provisions that were particularly concerning for the company, Sabharwal said there was not much to be concerned about at this stage.
Industry associations are also expected to submit their views on the proposed framework. Tata Capital, however, will provide its feedback separately to the regulator.
The RBI’s proposal seeks to move credit products offered by NBFCs towards a fixed repayment structure. Under the draft framework, the sanctioned amount would be disbursed either in a single instalment or through multiple instalments and would have to be repaid according to a predetermined amortisation schedule.
Repayment could take place through periodic instalments or through a bullet repayment on the specified due date or dates. Importantly, once the sanctioned amount has been disbursed, the limit would not be restored or replenished after the borrower repays either part or all of the principal.
This would distinguish the proposed structure from revolving facilities, where the borrower can reuse the available credit after repayment.
The draft also provides an exemption for NBFCs that have been specifically authorised by the RBI to issue credit cards. The restriction on revolving credit, therefore, would not apply to such entities in respect of their authorised credit card operations.
The RBI has set August 28, 2026 as the deadline for regulated entities and other stakeholders to submit their feedback and suggestions on the draft norms. The final framework will be determined after the central bank considers the responses received from the industry and other stakeholders.
Source PTI
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