RBI finalises co-lending framework starting Jan 2026

RBI's final co-lending rules, effective January 1, 2026, introduce blended lending rates and escrow-based cashflow, potentially impacting originator attractiveness. New norms allow partial credit enhancement for bonds issued by various entities, making them safer for investors. An RBI panel suggests retaining the call rate as the monetary policy target, favoring 7-day variable rate auctions for liquidity management.