Basel III Framework on Liquidity Standards – Net Stable Funding Ratio (NSFR)

RBI vide notification No. RBI/2020-21/95 dated 05th February, 2021 has issued a notification with respect to implementation of Net Stable Funding Ratio(NSFR) guidelines.
i) The NSFR promotes resilience over a longer-term time horizon by requiring banks to fund their activities with more stable sources of funding on an ongoing basis.
ii) Scope: Applicable for all Indian Banks and Foreign banks operating as branches in India.
iii) In view of the ongoing stress on account of COVID-19, it has been decided to defer the implementation of NSFR guidelines by a further period of six months. Accordingly, the NSFR Guidelines shall come into effect from October 1, 2021.

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