<h1>RBI Draft Guidelines: Banks Need Approval for Equity Investments in Financial Services, Caps on Non-Financial Investments.</h1> The Reserve Bank of India (RBI) issued draft guidelines under Section 19 of the Banking Regulation Act, 1949, addressing banks' equity investments in subsidiaries and non-subsidiary companies. Banks require RBI approval for investments in financial services companies and must adhere to prescribed limits. Equity investments in non-financial services companies are capped at 10% of the investee's or bank's paid-up capital and reserves, whichever is lower, without needing prior RBI approval. Banks must review and align their investments with these guidelines to prevent indirect involvement in non-permitted activities, ensuring compliance within specified timelines.