The Presidents/Chief Executive Officers

All Banks/DFIs

Dear Sir/ Madam,

Prudential Regulations for Consumer Financing

1. Please refer to the Prudential Regulations for Consumer Financing as amended from time to time.
2. It has been decided to allow financing of car older than five years and up to nine years. Accordingly, Prudential Regulation O-8 of Consumer Financing has been amended as below:

“REGULATION O-8”

The banks/DFIs desirous of financing the purchase of used cars shall prepare uniform guidelines for determining the value of the used vehicles. In no case the bank/DFI shall finance the cars older than nine years. However, cars older than five years and upto nine year can only be financed subject to the condition that complete repayment of financing is restricted within 12 years of such car age.

3. Please acknowledge receipt.