RBI Update - Reserve Bank of India (Housing Finance Companies) Second Amendment Directions, 2026

The Reserve Bank of India (Housing Finance Companies) Second Amendment Directions, 2026, effective from January 1, 2027, align the regulatory framework applicable to Housing Finance Companies (HFCs) with the newly introduced comprehensive conduct standards governing the advertising, marketing and sale of financial products and services by NBFCs. Pursuant to these amendments, the existing provisions relating to “Advertising, Marketing and Sales” and the “Code of Conduct for DSAs/DMAs” under the Reserve Bank of India (Housing Finance Companies) Directions, 2025 stand repealed and replaced. HFCs are now required to comply with paragraphs 101A to 101ZA of Chapter IIIA of the Reserve Bank of India (Non-Banking Financial Companies – Responsible Business Conduct) Directions, 2025, which prescribe detailed requirements relating to customer suitability and appropriateness assessments, explicit consent, disclosure standards, regulation of DSAs/DMAs and third-party product providers, prevention of mis-selling and compulsory bundling, prohibition of dark patterns, customer feedback mechanisms, compensation for mis-selling, and enhanced governance and compliance obligations, thereby establishing a uniform and strengthened consumer protection framework across the NBFC sector, including HFCs.