Skip to main content
RBI's Fourth Amendment Directions on Cash Reserve Ratio for Rural Banks
Back to Court News
Reserve Bank of Indiabanking

RBI's Fourth Amendment Directions on Cash Reserve Ratio for Rural Banks

September 6, 2026

The RBI has introduced the Fourth Amendment Directions regarding the Cash Reserve Ratio and Statutory Liquidity Ratio for rural co-operative banks, aiming to facilitate compliance and effective capital management.

RBI's Fourth Amendment Directions on Cash Reserve Ratio for Rural Banks

The Reserve Bank of India has announced the Fourth Amendment Directions pertaining to the Cash Reserve Ratio (CRR) and Statutory Liquidity Ratio (SLR) for rural co-operative banks, effective August 25, 2026. This regulatory change aims to aid in the effective management of liquidity ratios among these financial institutions.

The adjustments allow exemptions from the CRR and SLR requirements for fresh FCNR(B) deposits, supporting rural banks in enhancing their liquidity positions and enabling them to respond better to market conditions.

Legal practitioners representing rural co-operative banks will need to guide their clients through the implications of these changes, ensuring compliance with the updated directive and stability in their capital management practices.

Citations

  • RBI Circular No. 242 (2026) DOR.RET.REC.209/12.01.001
Practice Areas:banking

Related Articles

View All →
RBI Raises Repo Rate to 5.50% in Monetary Policy ReviewFeatured
Reserve Bank of Indiabankingcorporate

RBI Raises Repo Rate to 5.50% in Monetary Policy Review

The Monetary Policy Committee increased the policy repo rate by 25 basis points to 5.50% under the Liquidity Adjustment Facility, effective immediately.

Oct 8, 2026Read more →
RBI Launches ECL Framework for Forward-Looking ProvisioningFeatured
Reserve Bank of Indiabankingfinancial_regulation

RBI Launches ECL Framework for Forward-Looking Provisioning

From April 2027, banks must adopt the RBI’s Expected Credit Loss (ECL) framework, a three-stage provisioning model based on credit risk deterioration and Effective Interest Rate (EIR) calculations.

Oct 7, 2026Read more →
RBI Launches Expected Credit Loss Framework from April 2027Featured
Reserve Bank of Indiabankingcorporate

RBI Launches Expected Credit Loss Framework from April 2027

The RBI’s Expected Credit Loss (ECL) framework, effective April 2027, introduces a forward-looking, three-stage model for provisioning, replacing the current incurred loss approach. Banks must adopt EIR calculations and revised capital adequacy reporting.

Oct 5, 2026Read more →