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The Reserve Bank of India has released draft directions to revise concentration risk management and credit facility guidelines for Rural Co-operative Banks (RCBs). The proposals include updated prudential exposure limits for single and group counterparties, unsecured advances, and housing loans. Larger RCBs with deposits exceeding ₹1,000 crore are proposed to receive greater flexibility regarding housing loan tenors and moratoriums, while ceilings for other RCBs are set to increase. Additionally, the RBI proposes withdrawing existing prudential sectoral exposure limits, excluding the real estate sector. Stakeholders are invited to submit feedback on these draft directions by August 28, 2026, via the RBI's 'Connect 2 Regulate' portal or email.
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August 06, 2026
Review of Guidelines on Concentration Risk Management - Rural Co-operative Banks
In pursuance of the announcement made with regard to the captioned subject in the Statement on Developmental and Regulatory Policies dated August 5, 2026, the Reserve Bank of India has today issued the following draft Directions for public comments:
(i) Draft Reserve Bank of India (Rural Co-operative Banks – Concentration Risk Management) – Directions, 2026 to replace Reserve Bank of India (Rural Co-operative Banks – Concentration Risk Management) – Directions, 2025 (ii) Draft Reserve Bank of India (Rural Co-operative Banks – Credit Facilities) – Amendment Directions, 2026 to amend certain provisions of Reserve Bank of India (Rural Co-operative Banks – Credit Facilities) Directions, 2025
The above draft Directions prescribe, inter alia, prudential exposure limits for single/group counterparty, enhanced housing loan limits, and prudential exposure limits on unsecured advances. Additionally, it is proposed to allow flexibility to larger Rural Co-operative Banks (RCBs) with deposits above ₹1,000 crore in deciding the tenor and moratorium requirements for housing loans, while increasing the ceilings for these parameters in cases of other RCBs. Further, the prescribed prudential sectoral exposure limits, except for real estate sector, are proposed to be withdrawn.
The comments / feedback on the draft Directions may be submitted by the regulated entities and other stakeholders / members of public on or before August 28, 2026 through the following channels:
(i) The ‘Connect 2 Regulate’ section on the website by following the corresponding hyperlink provided against each document in the page where they are hosted; or (ii) by email with the subject line ‘Feedback on (full name of the draft Directions)’.
(Brij Raj) Press Release: 2026-2027/828 Chief General Manager ᮧेस ᮧकाशनी PRESS RELEASE
भारतीय ᳯरज़वर् बᱹक
RESERVE BANK OF INDIA
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