Niti Aayog proposes to include EVs in RBI’s priority-sector lending guidelines

By ET News

NITI Aayog has proposed government to include electric vehicles in the Reserve Bank of India’s priority-sector lending guidelines, the move it says will give a significant push to retail lending for EVs.

NITI Aayog, in its report on EVs with Rocky Mountain Institute (RMI) and RMI India released on Friday said, banks and non-banking financial companies (NBFCs) in India have the potential to achieve an electric vehicle (EV) financing market size of Rs 40,000 crore by 2025 and Rs 3.7 lakh crore by 2030.

“However, retail finance for EVs has been slow to pick up,” it said.

“Financial institutions have an important role to play in accelerating the adoption of EVs in India and supporting the decarbonisation of road transport,” said Amitabh Kant, CEO, NITI Aayog said.

“RBI’s PSL mandate has a proven track record of improving the supply of formal credit towards areas of national priority. It can provide a strong regulatory incentive for banks and NBFCs to scale their financing to EVs,” Kant added.

Priority-sector lending aims to expand financial access and support employment opportunities in India.

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