Why India Decided to Act
India’s financial market is enormous. Every day, hundreds of millions of transactions move between banks, businesses, and financial institutions. For years, however, a familiar problem persisted: who actually stands behind a transaction?
The 2008 financial crisis made that question impossible to ignore. Regulators discovered they could not quickly identify which market participants were exposed to failing counterparties. Data was fragmented, identifiers were inconsistent, and cross-border transparency was nearly nonexistent. As a result, the G20 established the LEI (Legal Entity Identifier, a global identifier for legal entities in financial transactions) system, overseen by GLEIF (Global Legal Entity Identifier Foundation, the body that manages the global LEI system).
GLEIF tracks LEI adoption across regulations worldwide and India stands out as one of the most thorough examples of how a country can roll out LEI at scale.
A Phased Rollout: 2017 to 2025
The Reserve Bank of India (RBI, India’s central bank) started with the largest borrowers in 2017 and extended the requirement in stages. Each phase came with a firm deadline and a clear threshold, so businesses had time to prepare without indefinite delays.
The timeline for borrowers ran as follows. Borrowers with total credit exposure above ₹25 crore (approximately €2.7 million) had to obtain an LEI by 30 April 2023. Those with exposure above ₹10 crore (approximately €1.1 million) had until 30 April 2024. Finally, the last phase closed on 30 April 2025, when the requirement extended to all borrowers with aggregate exposure of ₹5 crore (approximately €550,000) or more.
All three phases are now complete. In other words, the LEI requirement for borrowers in India is fully in force.
Who Needs an LEI and for What
The RBI has established LEI requirements across three areas.
Borrowers. All non-individual borrowers with aggregate credit exposure of ₹5 crore or more from banks and financial institutions must hold a valid LEI. The RBI calculates exposure across all lenders combined, covering both loans and other credit facilities. Moreover, under the RBI’s official circular, a borrower without a valid LEI cannot receive a new loan, and banks cannot renew or extend any existing facility either.
Large payments. Since 1 October 2022, all single payment transactions of ₹50 crore (approximately €5.5 million) or more through NEFT (National Electronic Funds Transfer) or RTGS (Real-Time Gross Settlement) must include the LEI of both the remitter and the beneficiary. In addition, this applies to all non-individual entities, with no exceptions for the transaction type.
Cross-border transactions. From the same date, authorised banks must record and report LEI details for all cross-border transactions of ₹50 crore or more under FEMA (Foreign Exchange Management Act, India’s law governing foreign currency transactions).