RBI Draft Directions 2026: New Conduct Framework for Housing Finance Companies on Advertising and Sales

The Reserve Bank of India has released the Draft Reserve Bank of India (Housing Finance Companies) Amendment Directions, 2026, proposing a significant shift in how Housing Finance Companies (HFCs) will be regulated in relation to advertising, marketing and sales practices.

Instead of maintaining a separate, standalone framework for HFCs, the Reserve Bank has opted to align them with a common regulatory code applicable to a larger group of Non-Banking Financial Companies (NBFCs). This move is aimed at ensuring consistent standards of customer protection and responsible business conduct across the financial sector.

These draft directions have been issued in exercise of powers under Section 30A of the National Housing Bank Act, 1987, and are proposed to take effect from July 1, 2026.

Background: Existing Regulatory Framework for HFCs

Earlier Position under the 2025 Directions

HFCs are presently governed by the Reserve Bank of India (Housing Finance Companies) Directions, 2025. Within these directions, Chapter X – “Fair Practices Code” lays down guidelines to ensure transparency, fairness, and ethical conduct in dealings with customers.

Two key subject areas were covered under this chapter:

  1. A.10 Advertising, Marketing and Sales

    • Spanning paragraphs 150 to 154, these provisions dealt with how HFCs could advertise their products, promote their services, and engage in sales practices when offering housing finance and related products.

  2. A.11 Code of Conduct for DSAs/DMAs

    • Paragraphs 155 to 157 prescribed norms for the conduct of Direct Selling Agents (DSAs) and Direct Marketing Agents (DMAs), who act as intermediaries in sourcing and selling financial products for HFCs.

These provisions were designed specifically for HFCs and functioned as part of their sector-specific code of fair practices.

Need for Regulatory Harmonisation

Upon reviewing the existing instructions, the Reserve Bank has concluded that it is more efficient and in the larger public interest to:

  • Consolidate similar norms across various categories of NBFCs, and
  • Apply a uniform conduct framework covering advertising, marketing, and sale of financial products or services.

Instead of retaining separate directions for each NBFC category, the RBI has decided to place comprehensive conduct requirements in a single document: the Reserve Bank of India (Non-Banking Financial Companies – Responsible Business Conduct) Directions, 2025.

Shift to the NBFC – Responsible Business Conduct Directions

New Umbrella Framework for NBFCs

The Reserve Bank has framed a detailed regulatory code titled Reserve Bank of India (Non-Banking Financial Companies – Responsible Business Conduct) Directions, 2025. These directions aim to:

  • Standardize rules relating to the promotion, sale, and servicing of financial products;
  • Enhance customer protection, transparency, and fair dealing; and
  • Streamline supervision over the conduct of NBFCs in the market.

These directions are intended to apply to all NBFCs with a customer interface, including HFCs, with certain exclusions.

Entities Covered and Excluded

The comprehensive instructions on advertising, marketing, and sale of financial products/services under the Responsible Business Conduct framework are applicable to:

  • All Non-Banking Financial Companies (NBFCs), including Housing Finance Companies (HFCs),

but specifically exclude the following categories:

  • Core Investment Companies,
  • NBFC-Account Aggregators, and
  • NBFCs not having any customer interface.

Thus, HFCs that directly deal with customers are clearly within the ambit of these new conduct norms.

Key Change Proposed by the 2026 Amendment Directions

The Draft Reserve Bank of India (Housing Finance Companies) Amendment Directions, 2026 have been issued under Section 30A of the National Housing Bank Act, 1987.