Effective from 24 April 2024, the RBI has raised the minimum capital requirement for ARCs from ₹100 crore to ₹300 crore.
Banking & Finance
Effective from 24 April 2024, the RBI has raised the minimum capital requirement for asset reconstruction companies (ARCs) from ₹100 crore to ₹300 crore. Under the new directives, ARCs, as of 11 October 2022, have been granted a transition period to achieve the revised minimum Net Owned Fund (NOF) requirement. They are expected to maintain a NOF of ₹200 crore by March 31, 2024, and reach the ₹300 crore mark by March 31, 2026. Furthermore, ARCs with a minimum NOF of ₹1,000 crore will be eligible to act as resolution applicants. However, these investments are subject to a cap of 10% of the ARC's NOF on maximum investment in such short-term instruments.
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