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ON-LENDING BY DFIs AND OTHER FINANCIAL INTERMEDIARIES
While DFIs are required to adhere to the average maturity criteria prescribed, namely, minimum of five
years for loans more than USD 20 million equivalent and minimum three years for loans less than or
equal to USD 20 million equivalent for their borrowing, they are permitted to on-lend at different
maturities. They may also on-lend for project-related Rupee expenditure. However, other financial
intermediaries are required to adhere to the general ECB guidelines on maturity as well as end-use in
their on-lending programs.
All financial intermediaries, including DFIs, are required to on-lend their external commercial borrowings
within 12 months of drawdown.
To enable better utilisation of ECBs by DFIs, it has been decided that DFIs would be permitted to onlend
such Recycled Funds (available with them on account of time mismatch between repayment obligation
of their sub-borrowers vis-à-vis those of DFIs to the offshore lenders), out of original ECBs only for
import of capital goods and project-related rupee expenditure.
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