AIF norms tightened: RBI caps bank, NBFC investment in AIF schemes at 10%; collective limit set at 20% of corpus

The Reserve Bank of India has set a 10% investment cap for regulated entities in any Alternative Investment Fund scheme, with a 20% limit on total contributions from all such entities. These updated directions, effective from 2025, also mandate 100% provisioning if an entity's AIF investment exceeds 5% and involves a debtor company, with potential exemptions granted by the RBI.