The Reserve Bank of India, RBI, in its latest decision has allowed banks and NBFC's to sponsor Infrastructure Debt Funds. The bank put a maximum equity ceiling of 49% stake in these infrastructure debt funds while remaining in the ambient of rules like capital market exposure norms.

The new guidelines would help meeting long-term financing for the banks and Non Banking Financial Companies (NBFCs) to set up Infrastructure Debt Funds (IDFs). An NBFC, according to revised parameters, sponsoring IDF- Mutual Fund should have a minimum Net Owned Funds (NOF) of Rs 300 crore and capital adequacy ratio of 15 per cent.

The banks should have less than 3 per cent NPA besides having a presence in the market at least for five years. The new norms introduced by SEBI would provide regulatory framework for IDF-MFs in line with the policy of government as highlighted by the Finance Minister in his budget speech for 2011-12.

The apex bank would come up with detailed guidelines after some time. Meanwhile, industry hailed the central bank's decision on NBFCs.