The Reserve Bank of India issued the Small Finance Banks – Cash Reserve Ratio and Statutory Liquidity Ratio (Amendment) Directions, 2026, with immediate effect, to align the regulatory framework with recent amendments to banking laws. Exercising powers under Section 35A of the Banking Regulation Act, 1949 and Section 42 of the RBI Act, 1934, the amendments follow the Banking Laws (Amendment) Act, 2025 and allied rules and regulations notified in December 2025 and January 2026. The Directions expand the scope of eligible counterparties by expressly including “other development financial institutions,” rationalise reporting requirements by deleting references to “cash in hand,” and update statutory reporting formats. Annexes to the Directions have been revised to reflect an expanded list of development financial institutions, updated terminology, and the removal of variable time references. Significantly, a new reporting line has been introduced for amounts deposited with the RBI under the Standing Deposit Facility Scheme. The amendments aim to ensure consistency, clarity, and updated liquidity reporting norms for small finance banks.
Reserve Bank of India
RBI/2025-26/198
DOR.RET.REC.395/12.01.001/2025-26 | Dated: January 22, 2026
Reserve Bank of India (Small Finance Banks – Cash Reserve Ratio and Statutory Liquidity Ratio) Amendment Directions, 2026
Please refer to Reserve Bank of India (Small Finance Banks – Cash Reserve Ratio and Statutory Liquidity Ratio) Directions, 2025 dated November 28, 2025.
2. Pursuant to the enactment of the Banking Laws (Amendment) Act, 2025, the Banking Regulation (Companies) Amendment Rules, 2025 and the Reserve Bank of India Scheduled Banks’ (Amendment) Regulations 2025 have been published in the Gazette of India dated December 10, 2025 and January 15, 2026 respectively.
3. Accordingly, in exercise of the powers conferred by Section 35A of the Banking Regulation Act, 1949 and pursuant to Section 42 of the Reserve Bank of India Act, 1934 and Sections 18 and 24 of Banking Regulation Act, 1949, as amended from time to time, and all other provisions / laws enabling the Reserve Bank of India in this regard, the Reserve Bank being satisfied that it is necessary and expedient in the public interest so to do, hereby, issues the Amendment Directions hereinafter specified.
4. These Directions shall be called the Reserve Bank of India (Small Finance Banks – Cash Reserve Ratio and Statutory Liquidity Ratio) Amendment Directions, 2026.
5. The provisions shall come into force with immediate effect.
6. These Amendment Directions modify the Reserve Bank of India (Small Finance Banks – Cash Reserve Ratio and Statutory Liquidity Ratio) Directions, 2025 as under:
(i) In paragraph 19 (1), the words “other development financial institutions as defined in section 2 (cccii) of the RBI Act, 1934” shall be inserted.
(ii) In paragraphs 28 (6) (v), the words ‘under “Cash in hand”‘ shall be deleted.
(iii) In Annex I (Form A), the words “National Bank for Agriculture and Rural Development, Export Import Bank of India” shall be substituted with “the Exim Bank, the National Housing Bank, the National Bank, the Small Industries Bank, the National Bank for Financing Infrastructure and Development or the other development financial institution”.
(iv) In Annex II (Form VIII),
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- The words “Export-Import Bank of India and National Bank for Agriculture and Rural Development” shall be substituted with “Exim Bank, National Bank, National Housing Bank, Small Industries Bank, National Bank for Financing Infrastructure and Development and other development financial institutions as defined in section 2 (cccii) of the Reserve Bank of India Act, 1934”
- The word “specified” shall be substituted with “notified” and words “from time to time” shall be deleted.
- a new item “Amount deposited with the Reserve Bank, under Standing Deposit Facility Scheme” shall be inserted.
Yours faithfully,
(Manoranjan Padhy)
Chief General Manager
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