The final guidelines regarding acceptance of public deposits by HFCs are largely in line with the draft norms issued in January 2024, except that of entities being given an additional time of six months (till January 2025 and July 2025) to comply with the requirements.
The changes are unlikely to materially impact deposit-accepting HFCs, given the adequate on-balance sheet liquidity available and their deposits being within the prescribed ceiling. However, there could be a higher cost of compliance.
In addition, the changes in the risk-weighted assets for undisbursed amount of housing loans/other loans would lead to some increase in reported Tier I capital (0.5% - 2%) for affordable housing finance companies (AHFCs), which have a significant share of the portfolio at 35% risk weight. However, the impact is unlikely to be significant as the share of undisbursed loans is relatively low at 5-10% and these AHFCs are comfortably placed on the capital front.
