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RBI Issues "Climate Risk Disclosure" Framework for Banks and NBFCs.

Banking & Finance | Dated: 16 Dec 2025

The Reserve Bank of India (RBI) has issued a comprehensive framework for "Climate Risk Disclosure" applicable to all Scheduled Commercial Banks and Top-Layer NBFCs. The framework mandates financial institutions to disclose their exposure to climate-related risks and their strategy to mitigate them, effective from FY 2026-27.

🎯 Key Highlights:

  • Entities must report on four pillars: Governance, Strategy, Risk Management, and Metrics & Targets.
  • This move aims to align the Indian financial sector with global sustainability reporting standards (IFRS S2).
  • Small Finance Banks and Regional Rural Banks are currently exempted from these mandatory disclosures.

💡 Other Important Facts:

  • Framework: Climate Risk Disclosure.
  • Applicability: SCBs and Top-Layer NBFCs.
  • Effective From: FY 2026-27.

📚 Test Your Knowledge:

RBI's new "Climate Risk Disclosure" framework will be mandatory for banks starting from which financial year?

Correct Answer: FY 2026-27

🚀 Quick Recap:

About RBI

  • Governor – Shaktikanta Das
  • HQ – Mumbai