The Reserve Bank of India (RBI) is considering easing regulations to allow greater foreign ownership stakes in Indian banks in response to growing foreign interest and the need for increased long-term capital as India's economy expands. This potential regulatory shift follows the precedent set by the Yes Bank deal and aims to attract more foreign investment into the banking sector. Additionally, the RBI is expected to soon respond to the universal bank license application submitted by AU Small Finance Bank, which could mark a significant development for the lender. Meanwhile, the Indian government is planning to introduce a new credit score system specifically targeting rural borrowers, aimed at improving credit access for farmers and rural populations. In the non-banking financial company (NBFC) sector, five listed microfinance institutions (MFIs) have collectively removed Rs 2,440 crore of bad loans from their balance sheets during the January-March quarter, indicating signs of revival in this segment.