Summary: The Reserve Bank of India (RBI) has issued the Reserve Bank of India (Urban Co-operative Banks – Cash Reserve Ratio and Statutory Liquidity Ratio) Fourth Amendment Directions, 2026 on August 25, 2026, bearing reference RBI/2026-27/241, DOR.RET.REC.208/12.01.001/2026-27. The Amendment Directions have been issued under Section 35A of the Banking Regulation Act, 1949, pursuant to Section 42 of the Reserve Bank of India Act, 1934 and Sections 18 and 24 read with Section 56 of the Banking Regulation Act, 1949. The Directions take effect immediately.
The amendment concerns the temporary exemption from maintenance of Cash Reserve Ratio (CRR) and Statutory Liquidity Ratio (SLR) available to Urban Co-operative Banks (UCBs) in respect of specified fresh FCNR(B) and NRE deposits. The underlying framework is contained in the Reserve Bank of India (Urban Co-operative Banks – Cash Reserve Ratio and Statutory Liquidity Ratio) Directions, 2025.
The earlier provisions provided an exemption for fresh FCNR(B) deposits of minimum tenor of three years and maximum tenor of five years mobilized, including deposits renewed upon maturity, by UCBs between June 8, 2026 and September 30, 2026. The framework also provided an exemption for fresh Non-Resident (External) Rupee (NRE) term deposits of tenor of three years or more mobilized, including deposits renewed upon maturity, between June 19, 2026 and September 30, 2026. The FCNR(B) exemption was introduced through the RBI (Urban Co-operative Banks – Cash Reserve Ratio and Statutory Liquidity Ratio) Second Amendment Directions, 2026, while the NRE deposit exemption was introduced through the Reserve Bank of India (Urban Co-operative Banks – Cash Reserve Ratio and Statutory Liquidity Ratio) Third Amendment Directions, 2026.
On review, RBI has now decided to shorten both exemption windows. The end date of September 30, 2026 is replaced by August 31, 2026. Accordingly, paragraph 21(5) of the 2025 Directions is amended so that the relevant fresh FCNR(B) deposits must be mobilized between June 8, 2026 and August 31, 2026. Similarly, paragraph 21(6) is amended so that the relevant fresh NRE term deposits must be mobilized between June 19, 2026 and August 31, 2026.
The Fourth Amendment Directions do not alter the stated tenor conditions in the supplied material. For FCNR(B) deposits, the qualifying tenor remains a minimum of three years and a maximum of five years. For NRE term deposits, the qualifying tenor remains three years or more. The amendment instead changes the final date by which the relevant deposits must be mobilized to qualify for the specified exemption.
The Directions expressly state that the amendments come into force with immediate effect. Thus, the regulatory change takes effect from August 25, 2026, with the relevant eligibility cut-off dates in paragraph 21(5) and paragraph 21(6) now ending on August 31, 2026.
The practical effect, based on the express amendment, is that UCBs will have a shorter period to mobilize fresh FCNR(B) deposits and qualifying fresh NRE term deposits for the specified CRR and SLR exemptions. The supplied material does not provide any further change to the underlying tenor conditions or other conditions governing those exemptions.
The Amendment Directions are therefore principally a date modification to the temporary CRR and SLR exemption framework applicable to specified deposits mobilized by Urban Co-operative Banks.
RESERVE BANK OF INDIA
RBI/2026-27/241
DOR.RET.REC.208/12.01.001/2026-27 | August 25, 2026
Reserve Bank of India (Urban Co-operative Banks – Cash Reserve Ratio and Statutory Liquidity Ratio) Fourth Amendment Directions, 2026
Please refer to the Reserve Bank of India (Urban Co-operative Banks – Cash Reserve Ratio and Statutory Liquidity Ratio) Directions, 2025 (updated as on June 19, 2026) wherein exemption from CRR and SLR maintenance have been provided to fresh FCNR(B) deposits of minimum tenor of three years and maximum tenor of five years and fresh Non-Resident (External) Rupee (NRE) term deposits of tenor of three years or more mobilized (including deposits that are renewed upon maturity) by the banks between June 8, 2026 to September 30, 2026 and June 19, 2026 to September 30, 2026 respectively. On review, it has been decided to amend the date “September 30, 2026” to the date “August 31, 2026” for the aforesaid exemptions.
2. 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, read with section 56 (AACS), 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.
3. These Directions shall be called the Reserve Bank of India (Urban Co-operative Banks – Cash Reserve Ratio and Statutory Liquidity Ratio) Fourth Amendment Directions, 2026.
4. The provisions shall come into force with immediate effect.
5. These Amendment Directions modify the Reserve Bank of India (Urban Co- operative Banks – Cash Reserve Ratio and Statutory Liquidity Ratio) Directions, 2025 as under:
i. In paragraph 21(5), the words “between June 8, 2026 and September 30, 2026” shall be substituted with “between June 8, 2026 and August 31, 2026”.
ii. In paragraph 21(6), the words “between June 19, 2026 and September 30, 2026” shall be substituted with “between June 19, 2026 and August 31, 2026”.
Yours faithfully,
(Manoranjan Padhy)
Chief General Manager
