Mumbai, Feb. 6 -- Reserve Bank of India (RBI) Governor Sanjay Malhotra said that the new proposal to allow banks to lend to Real Estate Investment Trusts (REITs) will be positive for the banks and the sector alike. He explained that while a framework for lending to real estate companies already existed, trusts were previously excluded from direct bank credit.

"It will help the real estate sector and the REITs. There is already a framework for lending by the banks to the real estate, only through companies and other legal entities. That lending was not allowed to be done in case the borrower was a trust," Governor Malhotra said. He noted that since similar lending is already permitted for Infrastructure Investment Trusts (InvITs), this ch...