It is quite common that whenever a borrower wishes to apply for a loan, lenders require the borrower to purchase an insurance policy, as a pre-condition for sanction. One may wonder if availing insurance can be a mandatory requirement for availing any loan? Insurance is not a regulatory requirement that is needed in loans, however, lenders prefer the same to safeguard their interest in the event of default.
In this article, the author examines the prevalent practice of lenders requiring borrowers to obtain insurance as a prerequisite for loan sanction and evaluates its permissibility within the regulatory framework.
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In the Monetary Policy Statement dated October 1, 2025, the RBI Governor announced several measures to strengthen consumer protection. Some of the measures introduced for enhancing consumer protection are as follows:
The Draft IOS Scheme has enhanced the scope of the grievance redressal mechanism and introduced a more structured procedural framework for complaint processing. The Draft Internal Ombudsman Directions further strengthen grievance redressal, enhance procedural clarity, and improve transparency through reporting requirements. This write-up analyses the proposed changes.
Reserve Bank – Integrated Ombudsman Scheme, 2021 (“RB-IOS, 2021”) and Reserve Bank – Ombudsman Scheme, 2025 (“Draft Scheme”)
Heads
Current Requirement
Proposed Requirement/Change
Implication
Definition of Customer
The term “Customer” is not defined
Defined under Para 3(1)(j) as: “Customer” means any person who engages, in a financial service /product or activity related thereto with a Regulated Entity, irrespective of whether such person has an account-based relationship with the Regulated Entity;
The scope of financial services included within the ambit of the Scheme has been widened. For eg:All types of credit facilities extended by the borrower to the customer;Guarantees or other non-fund based facilities offered by RE to customer;Demand Draft facilities offered by Banks; Services by RE, acting as an LSP, to other REs;
Compensation Ceilings
Up to ₹20 lakh for consequential loss ₹1 lakh for consolatory damages
Increased to ₹30 lakh for consequential loss & ₹3 lakh for consolatory damages
There was no cap on the value of dispute that can be brought before the Ombudsman. The same has been retained. Increment in the compensation limits
“Advisory” Mechanism
Not provided
Para 14(4) empowers the Ombudsman to encourage settlement between parties through a written agreement, subject to the fact that all communications are documented. Para 14(6) allows the Ombudsman to issue advisory for settlement as a measure for the resolution of complaints.
RBI Ombudsman can now help parties resolve disputes by settlement.Draft IOS Scheme permits advisories i.e., communications from the Ombudsman advising REs to take actions for full or partial complaint resolution.Advisories are non-binding and serve as a pre-award tool to facilitate quicker settlements.
Change in the Appellate Authority
Executive Director in charge of the Department of the Reserve Bank administering the Scheme;
The Draft IOS Scheme clearly mentions that the executive director in charge of the Consumer Education and Protection Department (CEPD) is the Appellate Authority
Explicitly mentions the independent department under the RBI to act as the Appellate Authority.
Guidance on filing of the complaint form
Guidance was provided under the Scheme at several places, but not at one place, along with the form
Added under Part A of Annexure, along with the Complaint Form
Minor edits in the complaint form with guidance to clarify the process for filing complaints and reduce errors.It will enable quicker allocation and segregation of complaints.The clear filing mechanism will improve ease and understanding for customers.Improved accessibility by the Launch of a 24×7 Contact Centre (#14448) with multilingual IVRS support.
Ombudsman Report
Earlier, the Ombudsman was required to submit an annual report to the Deputy Manager of the RBI; however, the RBI was not obligated to publish it
Under the Draft IOS Scheme, it has now been made mandatory for the RBI to publish an annual report on the functioning and activities carried out under the Scheme.
It will enable the regulator to understand the issues raised under the complaints and assess the effectiveness of the measures introduced.
Addition of an RE as third party to proceedings
Not provided
The Ombudsman can make any other RE as a party to the proceedings.
Expands the powers of the ombudsman to include connected REs as well (for instance, in the case of co-lending or TLE transactions)
Power of CRPC to classify and close complaints
Not explicitly mentioned
RBI Ombudsman and CRPC remain responsible for receipt and examination of complaints.The Complaints shall be treated as follows:Complaints in the nature of suggestions or queries shall be treated as non – valid at the stage of CRPFFurther, Para 10 specifies certain grounds for non maintainability of complaints for complaints to be rejected by the RBI Ombudsman.However the grounds of non-maintainability under Para 10 shall be specifically provided by the Competent Authority.
This clarifies the hierarchy for complaint handling and enables early elimination of frivolous or ineligible complaints before they reach the RE.
It may also be noted that the RBI has, vide notification dated 07th October 2025, extended the applicability of the existing RBI-IOS to include State Co-operative Banks and Central Co-operative Banks.
Draft Master Direction – Reserve Bank of India (Internal Ombudsman for Regulated Entities) Directions, 2023
Particulars of the Provision
Current Requirements
New Requirements
Implication
Eligibility of the IO (Para 5)
No such requirement prescribed
If the person is a serving officer, he/she is required to relinquish the same before assuming charge as IO. The IO shall previously not have been employed, nor presently be employed, by the RE or a holding, associate or subsidiary company of the RE.
To ensure the IO’s independence and impartiality, in case the proposed IO is a serving officer, he/she must relinquish the existing position before assuming charge, enabling objective and credible grievance redressal within the RE. Further, conflict of interest positions clarified by specifically defining the scope of Related Parties of the RE.
Same IO appointment in a number of entities
No such clause restricting the number of REs.
The IO can work in more than one RE simultaneously, with specific approval from the CEPDSuch approval shall be obtained by the appointing RE.However, the deputy IO cannot be appointed in more than one RE simultaneously
IO (but not deputy IO) has been permitted to be appointed in more than one RE simultaneously, subject to the approval from CEPD. Approval to be obtained by the appointing RE. Impact:To allow efficient deployment of an experienced IO across multiple REs under CEPD oversight, while ensuring sufficient focus at each entity so that the role and effectiveness are not compromised.
Terms of Appointment of IO
No clause that specifies the minimum no of IOs or the responsibility of the Board or its Committees w.r.t assessing the need for multiple IOs or the factors to be considered when doing so.
Every RE shall appoint at least one IO. The Board or its committees shall, at least annually, determine the number of IO/ Dy. IO to be appointed. This must be determined with due regard to the volume and complexity of the complaints received.
To ensure effective grievance redressal, clarity has been provided on the minimum number of IOs to be appointed and the annual assessment of the need for IOs. Actionables for the REs:All REs shall appoint at least one IO The Committee of the RE shall be required to assess the need of the no of IOs at least once in a yearFactors to be considered include complexity of complaints, sufficiency of the time, diversity of experience etc
Auto-escalation of complaints
All complaints that are partly or wholly rejected by the RE’s internal grievance redress mechanism shall be auto-escalated to the IO within 20 days of receipt for a final decision.
Auto-escalation of partly resolved or wholly rejected complaints to the office of the IO has been specified to be 25 days in case of CICs (Credit Information Companies)
To ensure timely escalation of unresolved complaints, the draft directions require auto-escalation to the IO within 20 days, with a relaxed timeline of 25 days for CICs, balancing prompt redressal with operational feasibility for CICs.
Board oversight – rotation of IOs
No such clause to ensure rotation of IOs in REs with multiple IOs exists in the current directions.
In REs having multiple IOs, a view shall be taken by the Board or Customer Service Committee / Consumer Protection Committee of the Board to have representation of more than one IO or having a system of rotation.
Actionables for REs:To ensure diversity in perspectives in grievance handling, REs with multiple IOs should consider Board-approved rotation or representation of more than one IO, enhancing fairness and effectiveness in complaint resolution.
Complaint Management System (CMS)
Under the current directions, REs do not have to provide specific categories in the CMS.
The REs shall provide only three categories i.e. ‘Fully Resolved’, ‘Partly Resolved’ and ‘Wholly Rejected’ in its CMS for recording the decision on the complaints before escalation to the office of IO.
RE shall be required to have in place a fully automated Complaint Management System. To standardise complaint recording, REs must limit CMS decision categories to ‘Fully Resolved’, ‘Partly Resolved’, and ‘Wholly Rejected’ before escalation to the IO, ensuring consistency and clarity in complaint tracking.
Procedure for Complaint Redress by IO / Dy. IO
The current directions allow the IO to only rely on documents that are furnished to it by the RE.
The IO / Dy. IO may, if they find it necessary, seek written or oral submission (including additional information and documents) from the complainant.
Strengthening the principle of hearing, enhances procedural transparency, and facilitates effective complaint redressal.
Reporting to Reserve Bank
The current directions have different disclosure requirements pertaining to categorisation of complaints and periodicity of reporting.
In addition to the existing details to be provided to the CEPD, the draft directions have included the additional details to be included such as Date of Birth and the Date of intimation to the Reserve Bank in its intimation to the CEPD. Further an additional periodic reporting requirement on quarterly basis instead of the previously annual requirement has been introduced for the REs.
These additional details enable the regulator to verify that the eligibility of the IO, as prescribed in the regulations, is being complied with specifically, ensuring the age limit of 70 years based on the date of birth and that the intimation to the RBI is duly sent. Further, the quarterly reporting requirement allows the CEPD to track the status of complaints and the IOs reported, enabling the regulator to assess implementation and the overall compliance position of the entity.
https://vinodkothari.com/wp-content/uploads/2023/06/vinod-kothari-logo.png00Team Finservhttps://vinodkothari.com/wp-content/uploads/2023/06/vinod-kothari-logo.pngTeam Finserv2025-10-10 18:34:572025-10-10 18:34:58RBI’s Draft on Integrated and Internal Ombudsman
When AIF Regulations were formally introduced in 2012, the regulatory approach was deliberately light. The framework targeted sophisticated investors, allowing flexibility with limited oversight. Over the years, however, AIFs have become significant participants in capital markets. Market practices over the decade exposed regulatory loopholes and arbitrages. For example, some investors who did not individually qualify as QIBs accessed preferential benefits indirectly through AIF structures and investors who were restricted to invest in certain companies started investing through AIF making AIF an investment facade. There were concerns regarding circumvention of FEMA norms as well1. In the credit space, regulated entities such as banks and NBFCs started channeling funds through AIFs to refinance their stressed borrowers, raising concerns around loan evergreening2. These developments prompted regulatory response. RBI first issued two circulars, one in 2023 and the other in 2024. Finally, in 2025 formal directions governing investments by regulated entities in AIFs were also issued3. These Directions introduced exposure caps and provisioning requirements.4
While the RBI addressed prudential risks arising from regulated entities’ participation in AIFs, SEBI focused on investor protection, governance within the AIF ecosystem and curbing the regulatory arbitrages. First it mandated on-going due diligence by AIF Managers5. It then mandated specific due diligence6 of investors and investments of AIF to prevent indirect access to regulatory benefits. Fiduciary duties of sponsors and investment managers and reporting obligations were progressively codified through circulars. Managers were expected to maintain transparency vis-a-vis their investment decisions, maintain written policies including ones to deal with conflict of interest with unitholders and submit accurate information to the Trustee. What were once broad, principle-based expectations have evolved into detailed, enforceable rules. Regulatory tightening has been matched by a more assertive enforcement approach. SEBI’s recent settlement order7 against an AIF underscores its increasing scrutiny of governance lapses, mismanagement of conflicts and inaccurate reporting. This clearly signals that any compliance gaps will no longer be overlooked and are likely to attract regulatory action. In a separate adjudication order, SEBI imposed penalties on both the Trustee and the Manager for the delayed winding-up of the scheme, underscoring that accountability within an AIF structure extends to all key parties and is not limited to the Manager alone.
However, SEBI’s approach has not been solely restrictive. Alongside regulatory tightening, it has also sought to preserve commercial flexibility and respond to market needs. Examples include the introduction of the co-investment framework8 for AIFs, framework for offering differential rights to select investors and a revamp for angel funds9.
Together, these measures are reshaping the regulatory landscape for AIFs and their managers. Investors can no longer rely on AIF structures to indirectly obtain regulatory advantages otherwise unavailable to them. As AIFs have grown in scale and importance, what is emerging is a more transparent, prudentially sound and closely supervised regulatory regime designed to align investor protection and commercial flexibility.
See SEBI’s Consultation paper on proposal to enhance trust in the AIF ecosystem ↩︎
See our write-up on AIFs being used for regulatory arbitrages here. ↩︎
See our write-up on changes w.r.t Angel Funds here↩︎
https://vinodkothari.com/wp-content/uploads/2023/06/vinod-kothari-logo.png00Staffhttps://vinodkothari.com/wp-content/uploads/2023/06/vinod-kothari-logo.pngStaff2025-10-09 10:45:482025-10-10 10:19:44AIF Regulatory framework evolves from light-touch to right-hold
https://vinodkothari.com/wp-content/uploads/2023/06/vinod-kothari-logo.png00Team Finservhttps://vinodkothari.com/wp-content/uploads/2023/06/vinod-kothari-logo.pngTeam Finserv2025-10-09 10:37:052025-10-09 17:38:55The Law of Prepaid Payment Instruments (PPIs): A Guide For New Market Entrants
As a part of its efforts to rationalise the regulations for establishment of a place of business in India by overseas entities[1], RBI has issued Draft Foreign Exchange Management (Establishment in India of a branch or office) Regulations, 2025. The proposals primarily aim to enable delegation of more powers to AD banks and reduction of compliance burden, thereby further enhancing the ease of doing business in India.
https://vinodkothari.com/wp-content/uploads/2023/06/vinod-kothari-logo.png00Team Corplawhttps://vinodkothari.com/wp-content/uploads/2023/06/vinod-kothari-logo.pngTeam Corplaw2025-10-06 16:41:442025-10-06 16:48:03SWAGAT to foreign branches or offices in India: RBI proposes draft regulations on such establishments
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The 2025 Amendments to the AIF Regulations has brought substantive changes to the regulatory landscape for angel funds, moving the same as a category of Cat I Funds, as against a sub-category of Venture Capital Funds. However, regulatory oversight strictens, with the access exclusively limited to accredited investors only. In view of the redundancy of a “scheme” in the context of angel funds (see below), the same has been omitted and replaced with each investment based participation of investors.
Angel Funds, a unique type of start-up friendly investment vehicle, was formally recognised by SEBI in the year 2013 with the introduction of Chapter III-A to the SEBI (Alternative Investment Funds) Regulations, 2012. As on 31st March 2025, there are 103 registered Angel Funds with a total commitment of Rs. 10,138 crores. The regulatory landscape for angel funds has been substantially revamped with the notification of SEBI (Alternative Investment Funds) (Second Amendment) Regulations, 2025, dated 8th September, 2025. The Amendment Regulations are further supplemented with a Circular dated September 10, 2025 prescribing the specific conditions and modalities pertaining to the provisions applicable to Angel Funds.
The amendments are based on the Consultation Paper dated 13th November, 2024, released post the Union Budget announcement of abolishment of angel tax (see a brief presentation here), for operational clarity and strengthening the governance and disclosure requirements for angel funds.
Uniqueness of structure
The uniqueness of Angel Funds lie in its structure. Unlike a typical AIF, in the case of Angel Funds, the investors provide specific consent to each investment opportunity. As such, there is no proportionality between the contribution of the investors in a scheme of AIF vis-a-vis the indirect contribution made in an investee company by such AIF scheme. As such, as against the usual “scheme” structure, an Angel Fund follows an “investment” structure.
Applicability
The Amendment Regulations are effective from the date of publication of the same in the Official Gazette, viz., 8th September 2025. The Circular was issued on 10th September, 2025. Further, in order to facilitate transition of the existing Angel Funds, additional timeline has been provided for compliance in some cases.
Exclusive to AIs: eligibility to act as an angel investor
Pursuant to the amendments, it is only an Accredited Investor who is eligible to be onboarded as an angel investor in an angel fund. The difference between the eligibility conditions are tabulated below:
Particulars
Angel Investors (Erstwhile Framework)
Accredited Investors (Amended Framework)
Categories of investors
Individual/Body corporate/AIF/ VCF
IndividualHUF Family trust Sole proprietorship Body corporate Trust other than family trust Partnership firm Government, Govt development agencies, QIBs, FPIs, Sovereign Wealth Funds etc – exempt from accreditation requirement
Eligibility criteria
In case of individual, Net tangible assets > Rs. 2 crs (excluding principal residence) andHas experience of Early stage investment or Serial entrepreneur or SMP with at least 10 years’ experience
In case of 1 to 4, either of the following: Annual income > Rs. 2 crs or Net worth > Rs. 7.5 crs out of which at least Rs. 3.75 crs is in the form of financial assets.Annual Income ≥ Rs. 1 cr + Net Worth ≥ Rs. 5 crs, out of which at least Rs. 2.5 crs is in the form of financial assets.In case of 7, each partner to separately meet aforesaid criteria
In case of body corporate, networth > Rs. 10 crs
In case of body corporate, networth > Rs. 50 crs
Trust other than family trust, networth > Rs. 50 crs
Independent accreditation
Not applicable
Applicable
Not only the eligibility conditions are stringent in case of AIs as compared to erstwhile concept of angel investors, but the mandatory “accreditation” criteria would be a primary factor that may lead to elimination of many investors who were earlier eligible for acting as an angel investor.
Transition period
For angel funds registered on or before 10th September 2025 (the date of issue of Circular), a timeline of 1 year, that is, upto 8th September 2026 has been specified, for transition into the new framework. During this period, offers can be made to upto 200 non-AIs.
No new contribution can be accepted from non-AIs post 8th September, 2026, though the investors continue to hold their existing investments already made in the angel fund.
Regulatory regime for Angel Funds: old v/s new
Topic
Old Framework
New Framework
Rationale
STRUCTURE OF THE FUND
Category of AIF [Reg 19A(1)]
Sub-category of VCF under Cat -I
Sub-category of Cat – I
In view of the unique features of Angel Funds as compared to VCFs. See differences below
Schemes under Fund [Reg 19E]
Allowed
Not allowed
Since there is practically no distinction between a “scheme” and an “investment” in the context of an angel fund, hence, the concept of scheme is not relevant for an angel fund.
Filing of placement memorandum with SEBI [Reg 19D(4)]
Not applicable
PPM to be filed along with application for registration through merchant banker for comments of SEBI
Previously, term sheets for each Schemes were filed with SEBI for “informational” purposes. The requirement has been substituted with filing of PPM at the time of registration itself.
Filing of the term sheet for schemes with SEBI [Reg 19E]
Mandatory, 10 days from launch of scheme
Not applicable
Term sheet is filed for material information of each Scheme, not relevant since scheme structure is omitted for angel funds
Minimum continuing interest of Sponsor/ Manager [Reg 19G]
2.5% of corpus or Rs. 50 lacs, whichever is lower
0.5% of investment amount or Rs. 50,000, in each investee, whichever is higher
To ensure that manager/sponsor has interest in every investment
INVESTMENT IN ANGEL FUND
Eligibility of investor [Reg 19D(1)]
Angel Investor based on certain eligibility conditions specified therein (see later in this article)
Accredited Investor KMP of Angel Fund/ Manager
To ensure proper verification of the risk appetite and informed decision making capabilities of the investor, since investment in start-ups are highly risky. To enhance skin in the game
Minimum corpus [Reg 19D(2)]
Rs. 5 crore
NA
NA since each investment is based on prior consent of investor, the concept of a common corpus is irrelevant
Minimum investment per investor [Reg 19D(3)]
Rs. 25 Lakhs
NA
No minimum limit since only AIs are allowed to invest
Minimum number of investors [Reg 19D(6)]
Not specified
At least 5 AIs prior to disclosing first close
To ensure sufficient investor interest prior to starting to make investments, in the absence of any minimum corpus requirement.
Maximum number of investors
200 in a scheme [Reg 19E(2) – omitted]
No limit
Since only AIs are eligible who are independently verified, sufficient guardrails exist. No cap on number of investors facilitate scaling up of the industry and enhance capital flow to start-ups. Further, ICDR Regulations have been amended to include AIs within the meaning of QIBs for the purpose of investment in angel funds, accordingly, the limit of 200 as per section 42 of the Companies Act, 2013 shall also not apply in case the AIF is formed as a company.
INVESTMENT BY ANGEL FUNDS
Prohibition from investment in certain investees [Reg 19F(6)]
Companies with family connection with any of the angel investors.
No investments from such investors who are related party to an investee
See below.
Follow-on investment in existing investee [proviso to Reg 19F(1)]
Not permitted once the investee ceases to be start-up
Allowed subject to the condition that the Fund’s post-issue shareholding percentage does not exceed pre-issue shareholding percentage
To protect and preserve the value of the existing investments of Angel Funds in an investee. Investment cap is to ensure that while pre-emptive rights can be exercised by angel funds, does not result in dilution of the regulatory intent behind angel funds
Minimum investment in an investee [Reg 19F(1)]
Rs. 25 Lakhs
Rs. 10 Lakhs
The increase in range is to reflect the growth of angel ecosystem, providing more flexibility to the Angel Funds
Maximum investment in an investee [Reg 19F(1)]
Rs. 10 crores
Rs. 25 crores (including upon follow-on investment)
Lock-in on investments [Reg 19F(3)]
1 year
6 months – if sold to a third party subject to AoA of investee. 1 year – in other cases, including buyback, sale to promoters of investee/ associates of promoters
To maintain stability of investments while providing flexibility of favourable exit to the angel fund
Minimum number of AIF investors in each investee [Reg 19F(5)]
No such limit
2 investors
Also serves as a check against misuse of angel fund structure for facilitating investments from single investor
COMPLIANCES APPLICABLE TO ANGEL FUNDS
Exception from application of certain provisions of the Regs [19B (2)]
Reg 10(a), (b), (c), (d), (f) – Conditions w.r.t. Investment in AIFReg 12 – Filing of Scheme Reg 14 – Listing of unitsReg 15(1)(a), (c), (e) – Conditions w.r.t. Investment by AIFReg 16(1)(b) – OmittedReg 16(2) – Additional conditions applicable to VCFsReg 20(21) – Rights of investors pro rata to their contribution
Following additional exceptions: Reg 15(da) – AIFs making investments through multiple layers of AIFsReg 16(1)(a) – Types of investeeReg 17 – Conditions for Cat II investments Reg 18 – Conditions for Cat III investments
The exceptions are majorly in alignment with the non-Scheme structure of the Angel Funds
Annual audit of compliance with terms of PPM
Not applicable
Mandatory, if total investment (at cost) exceeds Rs. 100 crs
Exemption to continue for smaller Angel Funds, larger Angel Funds be subject to audit of PPM
Reporting in relation to performance benchmarking
Not applicable
Applicable from FY 25-26
To improve transparency
Related Party v/s Family Connection
Angel Funds are not permitted to accept contributions from such investors, who are related parties to the investee company in which the investment is to be made. Here, the definition of “related party” is to be taken from Reg 2(1)(zb) of SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015. The definition, in turn, refers to Companies Act and applicable accounting standards as well.
Various questions arise:
Who prepares the list of related parties as per LODR definition? Is it the prospective investee that is responsible?
Can the investment manager and investor be absolved of their responsibilities of verification of whether or not the investor is a related party to the investee?
What if the investor becomes a related party of the investee entity, subsequent to making such investments?
The change from the term “family connection” to “related party” seems to simplify the identification for the prospective investee company, since such companies would have already identified related parties in terms of section 2(76) of CA, 2013 and applicable accounting standards. The only additional categories for such investees would be:
Promoters and members of promoter group, and
Shareholders holding 10% or more equity shares in the company on a beneficial interest basis.
Concluding Remarks
The amended regulatory framework makes it stringent for angel funds to raise funds from angel investors, restricting the access to accredited investors only. With the limited number of investors “accredited” registered in India (649 as on May 2025), early stage start-ups might face obstacles in startup funding. While SEBI has proposed ease of accreditation requirements, the same has not been made effective yet. As on 30th June 2025, data shows that the number of VCFs are much higher than the number of angel funds, and with the amended requirements, it might so happen that the investors would prefer VCFs over angel funds, as a means of investing in start-ups.
https://vinodkothari.com/wp-content/uploads/2023/06/vinod-kothari-logo.png00Staffhttps://vinodkothari.com/wp-content/uploads/2023/06/vinod-kothari-logo.pngStaff2025-10-04 15:55:452025-10-10 12:12:52Angel Funds 2.0: Navigating the New Regulatory Landscape
In its current hectic phase of revamping regulations, the RBI has issued Draft Directions for lending and contracting with related parties. Separate sets have been issued for commercial banks, other banks, NBFCs and financial institutions.
The definition of “related party” is more rationalised and improvised over the existing definitions in Companies Act or LODR Regulations. Loans above a “materiality threshold” [which is scaled based on capital in case of banks, and based on base/middle/upper layer status in case of NBFCs] will require board approval, and nevertheless, will require regulatory reporting as well as disclosure in financial statements. In case of contracts or arrangements with related parties, with the scope of the term derived from sec 188 (1) of the Companies Act, there are no approval processes, but disclosure norms will apply. In the case of banks, trustees of funds set up by banks are also brought within the ambit of “related persons”.
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