**RBI Raises IPO Financing Limit to ₹25 Lakh Per Investor**

*By Akash Pandey | Oct 01, 2025, 05:12 PM*

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**Overview**

The Reserve Bank of India (RBI) has announced a significant increase in the financing limit for Initial Public Offerings (IPOs), raising it from ₹10 lakh to ₹25 lakh per investor. This decision aims to improve credit flow in the economy and was revealed by RBI Governor Sanjay Malhotra following a three-day meeting of the monetary policy committee.

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**Key Regulatory Changes**

Alongside the hike in IPO financing limits, the RBI is set to remove the regulatory cap on lending against listed debt securities. In addition, the loan limit against shares has been raised substantially—from ₹20 lakh to ₹1 crore per person.

These measures form part of RBI’s wider strategy to enhance credit availability across the Indian economy.

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**Expansion of Banking Lending Scope**

In a major policy shift, Indian banks are now permitted to finance mergers and acquisitions (M&A) among domestic companies. This structural change is anticipated to bolster the banking sector by diverting deal financing from private credit players to formal banking channels.

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**Industry Response and Policy Alignment**

Experts have welcomed the RBI’s measures aimed at boosting credit flow. Chanchal Agarwal, Chief Investment Officer at Equirus Family Office, highlighted that these reforms will help banks regain credit flows previously moving towards structured credit products.

Furthermore, the RBI’s policy focuses on broadening credit intermediation, especially by enabling Urban Cooperative Banks to expand their services. This aligns with the government’s “Viksit Bharat” agenda, which emphasizes improving credit access and deepening India’s financial ecosystem.

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**Economic Projections**

The RBI has revised upward its GDP growth forecast for the current fiscal year from 6.5% to 6.8%, while lowering its Consumer Price Index (CPI) inflation estimate from 3.1% to 2.6%.

Murthy Nagarajan, Head of Fixed Income at Tata Asset Management, noted that these adjustments may create room for potential rate cuts in upcoming monetary policy meetings. The repo rate remains unchanged for now, as broadly expected.

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**Promoting the International Use of the Indian Rupee**

In efforts to enhance the global footprint of the Indian rupee (INR), the RBI has proposed measures to allow authorized Indian banks to offer rupee-denominated loans to non-residents in Bhutan, Nepal, and Sri Lanka for cross-border trade transactions.

Governor Malhotra stated that the RBI has made steady progress toward this goal, with the current proposals serving as critical steps in that direction.

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**Conclusion**

The RBI’s recent policy measures—including raising IPO financing limits, expanding lending scopes, and promoting the rupee’s internationalization—are designed to stimulate credit flow, support economic growth, and strengthen India’s financial system. Market participants and experts alike view these steps as positive developments for India’s evolving economic landscape.
https://www.newsbytesapp.com/news/business/rbi-enhances-ipo-financing-limit-improving-credit-flow/story