{"id":28188,"date":"2025-01-07T23:48:36","date_gmt":"2025-01-07T18:18:36","guid":{"rendered":"https:\/\/carajput.com\/blog\/?p=28188"},"modified":"2025-01-07T23:54:48","modified_gmt":"2025-01-07T18:24:48","slug":"new-rbi-norms-make-it-tough-to-get-multiple-personal-loans","status":"publish","type":"post","link":"https:\/\/carajput.com\/blog\/new-rbi-norms-make-it-tough-to-get-multiple-personal-loans\/","title":{"rendered":"New RBI norms make it tough to get multiple personal loans"},"content":{"rendered":"<div id=\"ez-toc-container\" class=\"ez-toc-v2_0_58 counter-hierarchy ez-toc-counter ez-toc-light-blue ez-toc-container-direction\">\n<p class=\"ez-toc-title\">Page Contents<\/p>\n<label for=\"ez-toc-cssicon-toggle-item-69e8013490054\" class=\"ez-toc-cssicon-toggle-label\"><span class=\"\"><span class=\"eztoc-hide\" style=\"display:none;\">Toggle<\/span><span class=\"ez-toc-icon-toggle-span\"><svg style=\"fill: #000000;color:#000000\" xmlns=\"http:\/\/www.w3.org\/2000\/svg\" class=\"list-377408\" width=\"20px\" height=\"20px\" viewBox=\"0 0 24 24\" fill=\"none\"><path d=\"M6 6H4v2h2V6zm14 0H8v2h12V6zM4 11h2v2H4v-2zm16 0H8v2h12v-2zM4 16h2v2H4v-2zm16 0H8v2h12v-2z\" fill=\"currentColor\"><\/path><\/svg><svg style=\"fill: #000000;color:#000000\" class=\"arrow-unsorted-368013\" xmlns=\"http:\/\/www.w3.org\/2000\/svg\" width=\"10px\" height=\"10px\" viewBox=\"0 0 24 24\" version=\"1.2\" baseProfile=\"tiny\"><path d=\"M18.2 9.3l-6.2-6.3-6.2 6.3c-.2.2-.3.4-.3.7s.1.5.3.7c.2.2.4.3.7.3h11c.3 0 .5-.1.7-.3.2-.2.3-.5.3-.7s-.1-.5-.3-.7zM5.8 14.7l6.2 6.3 6.2-6.3c.2-.2.3-.5.3-.7s-.1-.5-.3-.7c-.2-.2-.4-.3-.7-.3h-11c-.3 0-.5.1-.7.3-.2.2-.3.5-.3.7s.1.5.3.7z\"\/><\/svg><\/span><\/span><\/label><input type=\"checkbox\"  id=\"ez-toc-cssicon-toggle-item-69e8013490054\"  aria-label=\"Toggle\" \/><nav><ul class='ez-toc-list ez-toc-list-level-1 ' ><li class='ez-toc-page-1 ez-toc-heading-level-2'><a class=\"ez-toc-link ez-toc-heading-1\" href=\"https:\/\/carajput.com\/blog\/new-rbi-norms-make-it-tough-to-get-multiple-personal-loans\/#New_RBI_norms_make_it_tough_to_get_multiple_personal_loans\" title=\"New RBI norms make it tough to get multiple personal loans\">New RBI norms make it tough to get multiple personal loans<\/a><ul class='ez-toc-list-level-3'><li class='ez-toc-heading-level-3'><a class=\"ez-toc-link ez-toc-heading-2\" href=\"https:\/\/carajput.com\/blog\/new-rbi-norms-make-it-tough-to-get-multiple-personal-loans\/#Why_the_New_Norms\" title=\"Why the New Norms?\">Why the New Norms?<\/a><\/li><li class='ez-toc-page-1 ez-toc-heading-level-3'><a class=\"ez-toc-link ez-toc-heading-3\" href=\"https:\/\/carajput.com\/blog\/new-rbi-norms-make-it-tough-to-get-multiple-personal-loans\/#How_the_norms_will_impact_borrowers\" title=\"How the norms will impact borrowers:\">How the norms will impact borrowers:<\/a><\/li><li class='ez-toc-page-1 ez-toc-heading-level-3'><a class=\"ez-toc-link ez-toc-heading-4\" href=\"https:\/\/carajput.com\/blog\/new-rbi-norms-make-it-tough-to-get-multiple-personal-loans\/#Impact_on_lenders\" title=\"Impact on lenders:\">Impact on lenders:<\/a><\/li><li class='ez-toc-page-1 ez-toc-heading-level-3'><a class=\"ez-toc-link ez-toc-heading-5\" href=\"https:\/\/carajput.com\/blog\/new-rbi-norms-make-it-tough-to-get-multiple-personal-loans\/#Key_Challenges_on_New_RBI_Norms\" title=\"Key Challenges on New RBI Norms\">Key Challenges on New RBI Norms<\/a><ul class='ez-toc-list-level-4'><li class='ez-toc-heading-level-4'><a class=\"ez-toc-link ez-toc-heading-6\" href=\"https:\/\/carajput.com\/blog\/new-rbi-norms-make-it-tough-to-get-multiple-personal-loans\/#Increased_operational_burden\" title=\"Increased operational burden:\">Increased operational burden:<\/a><\/li><li class='ez-toc-page-1 ez-toc-heading-level-4'><a class=\"ez-toc-link ez-toc-heading-7\" href=\"https:\/\/carajput.com\/blog\/new-rbi-norms-make-it-tough-to-get-multiple-personal-loans\/#Credit_availability_concerns\" title=\"Credit availability concerns:\">Credit availability concerns:<\/a><\/li><\/ul><\/li><\/ul><\/li><\/ul><\/nav><\/div>\n<h2><img loading=\"lazy\" decoding=\"async\" class=\"alignnone size-full wp-image-28190\" src=\"https:\/\/carajput.com\/blog\/wp-content\/uploads\/2025\/01\/photo_2025-01-07_23-40-29.jpg\" alt=\"New RBI norms make it tough to get multiple personal loans\" width=\"841\" height=\"841\" srcset=\"https:\/\/carajput.com\/blog\/wp-content\/uploads\/2025\/01\/photo_2025-01-07_23-40-29.jpg 841w, https:\/\/carajput.com\/blog\/wp-content\/uploads\/2025\/01\/photo_2025-01-07_23-40-29-300x300.jpg 300w, https:\/\/carajput.com\/blog\/wp-content\/uploads\/2025\/01\/photo_2025-01-07_23-40-29-150x150.jpg 150w, https:\/\/carajput.com\/blog\/wp-content\/uploads\/2025\/01\/photo_2025-01-07_23-40-29-768x768.jpg 768w, https:\/\/carajput.com\/blog\/wp-content\/uploads\/2025\/01\/photo_2025-01-07_23-40-29-800x800.jpg 800w\" sizes=\"(max-width: 841px) 100vw, 841px\" \/><\/h2>\n<h2><span class=\"ez-toc-section\" id=\"New_RBI_norms_make_it_tough_to_get_multiple_personal_loans\"><\/span><span style=\"color: #000080;\"><strong>New RBI norms make it tough to get multiple personal loans<\/strong><\/span><span class=\"ez-toc-section-end\"><\/span><\/h2>\n<p>The Reserve Bank of India (RBI) has introduced a significant regulatory change requiring lenders to update credit bureau records every 15 days, effective January 1, 2025. This shift from the previous monthly reporting cycle aims to provide more frequent updates on borrowers&#8217; financial health and prevent the over-leveraging of individuals through multiple personal loans. Here\u2019s how and <span style=\"color: #000080;\">Why this change will impact borrowers and lenders:<\/span><\/p>\n<p>SBI Chairman C.S. Setty highlighted the issue of borrowers, particularly new to credit, taking multiple loans beyond their repayment capacity. He noted that the new reporting cycle will reduce the gap in data availability, offering lenders more accurate insights.\u00a0This move also aims to prevent scenarios where borrowers manipulate repayment schedules or take advantage of the delayed visibility of their liabilities in credit bureau systems.<\/p>\n<h3><span class=\"ez-toc-section\" id=\"Why_the_New_Norms\"><\/span><span style=\"color: #000080;\"><strong>Why the New Norms?<\/strong><\/span><span class=\"ez-toc-section-end\"><\/span><\/h3>\n<p>Address Over-Leveraging:\u00a0Borrowers often take personal loans from multiple lenders, sometimes exceeding their repayment capacity. The RBI&#8217;s new norm is designed to mitigate this risk by providing lenders with near real-time data on borrowers&#8217; financial activities.<\/p>\n<p>Improved Credit Assessment: Under the monthly reporting system, defaults or payments could go unreported for up to 40 days, leading to outdated information. The 15-day reporting cycle ensures timely updates, allowing lenders to make more informed credit decisions.<\/p>\n<p>Prevent Loan Stacking:\u00a0Loan stacking\u2014taking out multiple loans from various lenders before repayment history is updated\u2014has been a growing concern. The updated reporting frequency curtails this practice by quickly reflecting new borrowings on credit reports.<\/p>\n<p>Strengthening Risk Management:\u00a0The norm aligns with the broader goal of reducing non-performing assets (NPAs) by ensuring lenders have an accurate and current understanding of a borrower&#8217;s financial obligations.<\/p>\n<h3><span class=\"ez-toc-section\" id=\"How_the_norms_will_impact_borrowers\"><\/span><span style=\"color: #000080;\">How the norms will impact borrowers:<\/span><span class=\"ez-toc-section-end\"><\/span><\/h3>\n<p>The Reserve Bank of India&#8217;s (RBI) latest directive to reduce the credit reporting cycle to 15 days marks a pivotal shift in the lending ecosystem, aimed at tightening the grip on personal borrowing. Effective January 1, 2025, this new regulation ensures lenders report borrower activity to credit bureaus more frequently, providing a real-time snapshot of financial health and reducing the risks associated with multiple loans.<\/p>\n<ul>\n<li>Difficulty in Securing Multiple Loans:\u00a0Borrowers with outstanding loans or a history of delays will find it harder to obtain new loans, as lenders will have real-time visibility of their debt profile.<\/li>\n<li>Reduced Approval Chances for High-Risk Borrowers:\u00a0Frequent updates will expose risky borrowing patterns, such as taking multiple loans in a short period, leading to stricter scrutiny by lenders.<\/li>\n<li>Faster Detection of Defaults:\u00a0Any missed EMI payments will be reflected sooner, impacting credit scores and reducing access to additional credit.<\/li>\n<\/ul>\n<h3><span class=\"ez-toc-section\" id=\"Impact_on_lenders\"><\/span><span style=\"color: #000080;\"><strong>Impact on lenders:<\/strong><\/span><span class=\"ez-toc-section-end\"><\/span><\/h3>\n<ul>\n<li>Enhanced Credit Risk Monitoring:\u00a0Lenders will be better equipped to assess borrower risk, reducing the likelihood of defaults.<\/li>\n<li>Streamlined Decision-Making:\u00a0Timely updates enable lenders to promptly decide on loan applications, improving operational efficiency.<\/li>\n<li>Improved Portfolio Health:\u00a0By curbing over-leveraging and loan stacking, lenders can maintain a healthier loan portfolio.<\/li>\n<\/ul>\n<h3><span class=\"ez-toc-section\" id=\"Key_Challenges_on_New_RBI_Norms\"><\/span><span style=\"color: #000080;\"><strong>Key Challenges on New RBI Norms<\/strong><\/span><span class=\"ez-toc-section-end\"><\/span><\/h3>\n<h4><span class=\"ez-toc-section\" id=\"Increased_operational_burden\"><\/span><span style=\"color: #000080;\">Increased operational burden:<\/span><span class=\"ez-toc-section-end\"><\/span><\/h4>\n<p>Lenders must adapt their systems to comply with the new reporting frequency, potentially incurring higher costs.<\/p>\n<h4><span class=\"ez-toc-section\" id=\"Credit_availability_concerns\"><\/span><span style=\"color: #000080;\"><strong>Credit availability concerns:<\/strong><\/span><span class=\"ez-toc-section-end\"><\/span><\/h4>\n<p>Borrowers with genuine needs may face delays or denials due to stricter assessment processes.<\/p>\n<p>This move by the RBI represents a proactive step towards fostering financial discipline and reducing systemic risk. However, while it safeguards lenders and the economy, borrowers will need to adopt more responsible borrowing practices to avoid negative implications on their credit profiles.<\/p>\n<p>The RBI\u2019s move to shorten the credit reporting cycle to 15 days is a landmark step toward fostering financial discipline, reducing systemic risk, and preventing over-borrowing. While the changes will make it harder for borrowers to take multiple loans simultaneously, they aim to create a healthier and more transparent lending environment. Borrowers must now focus on maintaining clean credit profiles and responsible financial practices to adapt to this new regulatory landscape.<\/p>\n<blockquote class=\"wp-embedded-content\" data-secret=\"mVkoSgpfWG\"><p><a href=\"https:\/\/carajput.com\/blog\/how-to-reduce-your-loan-burden-smartly\/\">How to reduce your Loan burden smartly?<\/a><\/p><\/blockquote>\n<p><iframe class=\"wp-embedded-content\" sandbox=\"allow-scripts\" security=\"restricted\" style=\"position: absolute; clip: rect(1px, 1px, 1px, 1px);\" title=\"&#8220;How to reduce your Loan burden smartly?&#8221; &#8212; Rajput Jain &amp; Associates\" src=\"https:\/\/carajput.com\/blog\/how-to-reduce-your-loan-burden-smartly\/embed\/#?secret=43cV4nHoSi#?secret=mVkoSgpfWG\" data-secret=\"mVkoSgpfWG\" width=\"600\" height=\"338\" frameborder=\"0\" marginwidth=\"0\" marginheight=\"0\" scrolling=\"no\"><\/iframe><\/p>\n","protected":false},"excerpt":{"rendered":"<p>New RBI norms make it tough to get multiple personal loans The Reserve Bank of India (RBI) has introduced a significant regulatory change requiring lenders to update credit bureau records every 15 days, effective January 1, 2025. This shift from the previous monthly reporting cycle aims to provide more frequent updates on borrowers&#8217; financial health &hellip;<\/p>\n","protected":false},"author":1,"featured_media":0,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[11],"tags":[],"aioseo_notices":[],"_links":{"self":[{"href":"https:\/\/carajput.com\/blog\/wp-json\/wp\/v2\/posts\/28188"}],"collection":[{"href":"https:\/\/carajput.com\/blog\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/carajput.com\/blog\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/carajput.com\/blog\/wp-json\/wp\/v2\/users\/1"}],"replies":[{"embeddable":true,"href":"https:\/\/carajput.com\/blog\/wp-json\/wp\/v2\/comments?post=28188"}],"version-history":[{"count":4,"href":"https:\/\/carajput.com\/blog\/wp-json\/wp\/v2\/posts\/28188\/revisions"}],"predecessor-version":[{"id":28191,"href":"https:\/\/carajput.com\/blog\/wp-json\/wp\/v2\/posts\/28188\/revisions\/28191"}],"wp:attachment":[{"href":"https:\/\/carajput.com\/blog\/wp-json\/wp\/v2\/media?parent=28188"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/carajput.com\/blog\/wp-json\/wp\/v2\/categories?post=28188"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/carajput.com\/blog\/wp-json\/wp\/v2\/tags?post=28188"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}