In the communication dated June 07, 2024, addressed to all scheduled commercial banks (excluding RRBs), small finance banks, and local area banks, the RBI announced a revision to the definition of “Bulk Deposits.” Previously, single rupee term deposits of rupees two crore and above were considered bulk deposits for scheduled commercial banks and small finance banks, while the threshold for regional rural banks (RRBs) was rupees one crore.
However, with the recent amendment, the threshold for bulk deposits has been increased. Now, single rupee term deposits of rupees three crore and above will be categorized as bulk deposits for scheduled commercial banks and small finance banks. For RRBs and local area banks, the threshold remains at rupees one crore.
This amendment aims to provide clarity and align the definition of bulk deposits across different categories of banks. By revising the threshold, the RBI seeks to ensure consistency and uniformity in regulatory standards governing deposit interest rates.
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Reserve Bank of India
RBI/2024-25/40
DoR.SPE.REC.No.24/13.03.00/2024-2025
June 07, 2024
All Scheduled Commercial Banks (excluding RRBs)
All Small Finance Banks
All Local Area Banks
Madam / Sir,
Amendment to Master Direction – Reserve Bank of India (Interest Rate on Deposits) Directions, 2016
Please refer to paragraph 3(a)(i) of the Master Direction – Reserve Bank of India (Interest Rate on Deposits) Directions, 2016 dated March 03, 2016, wherein the definition of “Bulk Deposits” has been prescribed.
2. On a review, it has been decided to revise the definition of bulk deposits for all Scheduled Commercial Banks (excluding RRBs), Small Finance Banks and Local Area Banks. The term “Bulk Deposit” would now mean:
i. Single Rupee term deposits of Rupees three crore and above for Scheduled Commercial Banks (excluding RRBs) and Small Finance Banks.
ii. Single Rupee term deposits of Rupees one crore and above for Local Area Banks as applicable in case of Regional Rural Banks.
3. The relevant provisions of the Master Direction are being modified to reflect the changes as given in the Annex. All other instructions in this regard shall remain unchanged.
4. These instructions are issued in exercise of the powers conferred by Section 35A of the Banking Regulation Act, 1949.
Applicability
5. These instructions shall be applicable to all Scheduled Commercial Banks (excluding RRBs), Small Finance Banks and Local Area Banks.
Commencement
These instructions shall come into force with immediate effect.
Yours faithfully,
(Latha Vishwanath)
Chief General Manager
Enclosure: As above
Annex
[Encl. to circular DoR.SPE.REC.No.24/13.03.00/2024-2025 dated June 07, 2023]
| I. Amendments to Master Directions | ||
| Sr. No. | Existing Section | Amended Section |
| A. Master Direction – Reserve Bank of India (Interest Rate on Deposits) Directions, 2016 dated March 03, 2016 (Updated as on June 07, 2024) | ||
| Para 3 (a) (i) | Definitions
(a) In these Directions, unless the context otherwise requires, the terms herein shall bear the meanings assigned to them below: (i) “Bulk Deposit” means: i. Single Rupee term deposits of Rupees two crore and above for Scheduled Commercial Banks (excluding Regional Rural Banks) and Small Finance Banks. ii. Single Rupee term deposits of Rupees one crore and above for RRBs. |
Definitions
(a) In these Directions, unless the context otherwise requires, the terms herein shall bear the meanings assigned to them below: (i) “Bulk Deposit” means: i. Single Rupee term deposits of Rupees three crore and above for Scheduled Commercial Banks (excluding Regional Rural Banks) and Small Finance Banks. i. Single Rupee term deposits of Rupees one crore and above for Regional Rural Banks and Local Area Banks. |
