Draft RBI Non-Fund Based Credit Facilities Directions: The draft directions aim to streamline and regulate non- fund based (NFB) credit facilities, such as guarantees and letters of credit, across all regulated entities (REs) including commercial banks, cooperative banks, All India Financial Institutions, and NBFCs. A key aspect of the draft is the stipulation that REs generally should only issue NFB facilities to customers with an existing business relationship (funded credit or deposit facility). These outline general conditions applicable to all NFB facilities, as well as specific requirements for guarantees, including the need for them to be irrevocable, unconditional, and incontrovertible. It also addresses the use of electronic guarantees, sets limits on unsecured guarantees for certain REs, and specifies conditions for counter-guarantees and invoked guarantees. The comments/ feedback from stakeholders are invited. (RBI Draft Directions Dated 09/04/2025)