RBI · Banking Regulation
RBI tightens income recognition rules for AIFIs on acquired stressed assets
RBI mandates reversal of previously recognised but unrealised interest on Specified Non-Financial Assets by September 2027.
What changed
- AIFIs cannot recognise accrued but unrealised interest from extinguished exposure upon SNFA acquisition
- Any such income recognised before Sep 30, 2026 must be reversed by Sep 30, 2027
- Income from SNFA to be booked as non-interest income when realised; expenses booked when incurred
The read
RBI barred AIFIs from recognising accrued but unrealised interest on acquired stressed assets. Any income already booked as of September 30, 2026 must be reversed by September 30, 2027, ensuring income is only recognised upon realisation and expenses are booked immediately. The rule curbs premature profit booking and strengthens balance sheet transparency.
Key numbers
- Effective date: October 01, 2026
- Reversal deadline: September 30, 2027
Primary source: rbi.org.in