NABKISAN’s Direct Assignment (DA) framework enables the acquisition of standard, high-quality loan portfolios from eligible RBI-regulated entities such as NBFCs, MFIs, and HFCs. This structured bilateral arrangement supports our mission to expand responsible credit delivery, strengthen last-mile access, and build a diversified retail MSME portfolio.
Purpose: The DA framework is aligned with the Reserve Bank of India (Commercial Banks- Transfer and Distribution of Credit Risk) Transfer of loan exposures Directions, 2025 and facilitates the transfer of identified, non-default loan pools to NABKISAN, with clear separation of risks and rewards. Through this model, NABKISAN:
· Expands its retail sector outreach through credible partners
· Enhances credit delivery mechanisms
· Complements its co-lending programme using shared technology infrastructure
Eligible Partners & Loan Pools:
· NBFC-ICC, NBFC-MFI, and HFCs regulated by RBI
· Strong financials, governance standards, and portfolio performance
Key Eligibility Criteria:
· External Rating: A and above
· Internal Rating: NKR1 or NKR2· AUM: INR 500 Cr+
· Net Worth: INR 100 Cr+
· GNPA: <4%· CRAR: >20%
· Minimum 5 years of operations
· Profitable for last two years
· Current Collection Efficiency: ≥ 90%
· TOL/ATNW- Not more than 7 Times
Eligible Assets:
· Standard Assets- Loans that are not classified as NPA or SMA by the transferor/ assignor on the date of transfer.
· Secured loan pools.
· Asset classes covered under the latest Board approved Loan Policy for direct assignment.
· Loans compliant with RBI’s MHP/MRR requirements.
· Exclusions: Revolving credit Facilities, Structures in which short term instruments such as commercial paper which are periodically rolled over are issued against long term assetsheld by a SPE, Re-securitisation exposures (e.g., Mortgage-backed / asset-backed securities), Restructured loans in specified period, Loans with bullet repayment, Synthetic securitization, Exposure to other lending institutions, Assets with <18 months residual maturity, Refinance exposure of All India Financial Institutions etc.
Risk Management & Due Diligence: NABKISAN undertakes complete due diligence equivalent to originating a fresh loan, As per RBI regulations NABKISAN evaluates at least one-third of the portfolio (by number and value), with the originator retaining minimum 10% economic interest.
Pricing & Valuation Framework: Loan pools are valued on an arm’s-length basis using:
· Present value of expected cash flows
· Loss estimation (LE) by a credit rating agency — up to 4% maximum
· Stress testing and prepayment assumptions
· Minimum Rate of Return formula considering:o Cost of Fundso Operating Costso Credit Risk Premiumo Margin (as per Board-approved methodology)
Documentation: Assignment Agreement, Servicing Agreement, Power of Attorney, Any additional regulatory and transaction-related documents
