RBI co-lending norms may raise lenders' cost burden, say experts

LENDING LOAD

- KSHIPRA PETKAR

EVEN THOUGH THE Reserve Bank of India's (RBI) final co-lending guidelines provide more clarity and a regulated path, it is likely to drive up operational costs for lenders, market participants said.

On August 6, the central bank released the final guidelines for co-lending, which detailed several operational guidelines such as the use of escrow accounts for all transactions, compliance with know-your customer (KYC) guidelines, and the inclusion of loans under the co-lending arrangements in audits.