RBI’s 15-day credit reporting mandate: Impact & solutions

The Reserve Bank of India (RBI) has introduced a new regulatory mandate requiring lenders to update credit bureau records every 15 days, effective January 1, 2025. This marks a significant shift from the existing monthly reporting practice and demands swift policy adaptations from banks and Non-Banking Financial Companies (NBFCs). The move is aimed at improving credit data accuracy, ensuring timely risk assessment, and reducing discrepancies in borrower profiles. However, it also places operational and technological pressure on financial institutions.

Understanding RBI’s New Credit Reporting Mandate

Historically, financial institutions in India have been required to update credit bureau records on a monthly basis. This process allows credit information companies (CICs) like CIBIL, Equifax, Experian, and CRIF High Mark to maintain borrower credit histories, influencing lending decisions across the industry.

However, the RBI’s new mandate will reduce this reporting window to 15 days. The objective is to ensure more real-time and accurate credit updates, reducing the risk of outdated or incorrect information influencing lending decisions. This change is particularly critical given India’s rapidly growing credit market and the increasing reliance on alternative credit models for financial inclusion.

The new requirement brings several challenges and changes to risk and credit policy management:

1. Increased Operational Burden

Lenders will now need to update their credit records twice a month instead of once. This doubles the workload on credit teams, requiring seamless data integration with credit bureaus.

2. Changes in Risk Management and Decisioning

Faster credit reporting will result in more up-to-date borrower profiles, allowing lenders to make more informed decisions. However, institutions that fail to update data accurately within the new timeframe risk compliance issues and reputational damage.

3. Need for Robust IT and Compliance Frameworks

Legacy systems in banks and NBFCs may not be equipped to handle the increased frequency of updates efficiently. Without automation, manual processes could lead to delays, errors, and non-compliance penalties.

4. Impact on Loan Approvals and Collections

With real-time updates, lenders will need to be more proactive in monitoring borrower behavior, making loan approvals and collections more dynamic. Borrowers with deteriorating financial conditions will reflect in records much faster, requiring quicker risk mitigation actions.

Discover how no code rule engines can automate credit reporting and ensure seamless compliance with RBI’s 15-day mandate.

‍How a No-Code Rule Engine Can Help Lenders Stay Compliant

Given the complexity and frequency of the new credit reporting requirement, financial institutions must adopt technology that facilitates rapid policy adjustments. A no-code rule engine enables business teams to modify credit policies without the need for extensive technical intervention. Here’s how it helps:

1. Enables Rapid Policy Updates

With a no-code rule engine, risk and credit teams can configure new credit policies, set validation rules, and deploy changes instantly. This eliminates delays caused by traditional IT development cycles.

2. Automates Credit Data Processing

A centralized rule engine can automate the extraction, validation, and submission of credit data to bureaus, ensuring compliance with the 15-day mandate without manual intervention.

3. Reduces Compliance Risks

The ability to configure alerts and compliance checks within the system helps institutions detect any missing or incorrect data before submission, reducing the risk of penalties.

4. Integrates Seamlessly with Existing Systems

A no-code rule engine integrates with core banking systems, Loan Origination Systems (LOS), and Loan Management Systems (LMS), ensuring smooth data flow for timely credit reporting.

5. Empowers Business Users

Instead of relying on IT teams, business and compliance teams can directly configure reporting rules, adjust data submission processes, and ensure regulatory alignment in real time.

The RBI’s new 15-day credit reporting mandate is a step toward greater transparency and accuracy in India’s lending ecosystem. While it presents operational and compliance challenges, adopting no-code rule engines can empower financial institutions to stay agile and compliant without disrupting business operations. As regulatory frameworks continue to evolve, technology-driven solutions will be key to ensuring compliance while maintaining operational efficiency.

Financial institutions that proactively implement automated decisioning platforms will not only stay ahead in compliance but also enhance their ability to make data-driven lending decisions with precision and speed.