RBI amends Credit Facilities Directions across all lender classes on divisible-project financing

On 15 July 2026, the Reserve Bank of India added identical Explanations to the Credit Facilities Directions for Commercial Banks, Small Finance Banks, NBFCs, AIFIs and Urban Cooperative Banks, permitting a lender to finance independent viable units of a project as separate financings only where each unit is appraised ex-ante for standalone viability and has its own financial closure, and clarifying that for combined generation-and-transmission electricity projects the transmission right-of-way requirement may be determined per sub-paragraph (3); effective immediately.

The change gives lenders across all five classes discretion to structure a divisible project as separate financings, but conditions that discretion on a documented ex-ante standalone-viability appraisal and a separate financial closure for each unit. A lender that finances split units without those two conditions cannot rely on the Explanation and is financing outside the framework of the Directions. Separately, for electricity projects spanning both generation and transmission, the transmission right-of-way requirement is now tied to sub-paragraph (3) of the relevant paragraph, constraining how transmission scope is assessed at appraisal. The paragraph numbers differ by instrument (Commercial Banks 78/80, SFBs 78/80, UCBs 67/69, AIFIs 39/41, NBFCs 70/72) but the operative conditions are identical.