Mumbai, Jan. 5 -- The Reserve Bank of India (RBI) on Monday made changes to its October proposals on related party transactions of banks and non-bank financiers, accepting a clutch of suggestions from the industry.

In October the regulator had proposed changes to regulations on lending to counterparties that are related or connected to the lending bank. This could be either through ownership in the bank or through their ability to control and influence the lending decisions.

The RBI said at the time that such control may prove detrimental to the interests of the bank and other stakeholders. "As related parties can be many entities other than what is covered under extant statutory or regulatory restrictions, direct or indirect lending to...