 | | | Volume XXII | Issue 6 | September 2026
MONETARY & CREDIT INFORMATION REVIEW |  | | | | | |
Note from the Editor The September issue of the Monetary and Credit Information Review highlights the role of Reserve Bank of India in driving robust institutional changes, enforcing structural resilience, and steering steady economic progress amidst global volatility. The issue features the Third Conference for Registrars of Cooperative Societies, regulatory directions on tackling money mules by proposing temporary debit holds to freeze suspected fraud and money-mule accounts in its draft directions. It also features an addition to the list of scheduled banks, the issuance of final directions on Minimum Capital Requirements for Market Risk, release of supervisory metrics which measures adherence to reporting parameters across accuracy, timeliness, completeness, and consistency by regulated entities, etc. We remain committed to our goal of sharing accurate information and fostering deeper understanding. The MCIR can be accessed at https://mcir.rbi.org.in as well as by scanning the QR Code. We welcome your feedback at mcir@rbi.org.in. Brij Raj
Editor | I. Regulation Conference for Registrars of Cooperative Societies held at Reserve Bank of India, New Delhi on September 1, 2026 The Reserve Bank hosted the Third Conference of Registrars of Cooperative Societies (RCS) at its New Delhi office on September 1, 2026. Deputy Governors Shri Swaminathan J and Shri Shirish Chandra Murmu; Shri Shiv Pal Singh, Central Registrar of Cooperative Societies (CRCS), Registrars of Cooperative Societies from various States, and senior officers of RBI participated in the Conference. Deputy Governor Shri Swaminathan J emphasised stronger governance and institutional capacity in UCBs, closer coordination between the RBI and the RCS/CRCS, and timely action where needed. He also highlighted the need to strengthen controls against cyber-enabled frauds and money-mule accounts and referred to Mission SAKSHAM as an initiative for capacity building in the sector. Deputy Governor Shri Shirish Chandra Murmu observed that while cooperation has deep roots in India, a cooperative society, once licensed as a bank, assumes greater responsibilities and accountability. He emphasised the importance of professional and fit-and-proper Boards and senior management, robust internal controls, greater technology adoption and timely resolution of weak UCBs. Shri Shiv Pal Singh, Central Registrar of Cooperative Societies (CRCS), emphasised closer coordination between the cooperative authorities and the RBI, continued professionalisation of UCBs, and timely resolution of banks under liquidation. Discussions during the Conference covered key governance, regulatory and supervisory issues concerning UCBs, including the expectations of the RBI and the Deposit Insurance and Credit Guarantee Corporation (DICGC). To read more, please click here. Inclusion of “Coastal Local Area Bank Limited” in the Second Schedule to the Reserve Bank of India Act, 1934 Coastal Local Area Bank Limited has been included in the Second Schedule to the Reserve Bank of India Act, 1934 vide Notification DoR.LIC.No.S3539/22-03-070/2026-27 dated July 28, 2026, and published in the Gazette of India (Part III – Section 4) dated August 11, 2026. Recognition of Self-Regulatory Organisation in the FinTech Sector (SRO-FT) The Reserve Bank had recognised FinTech Association for Consumer Empowerment (FACE) as the first Self-Regulatory Organisation in the FinTech Sector (SRO-FT), vide Press Release dated August 28, 2024. RBI has since received an application from the Unified Fintech Forum (UFF) seeking recognition as SRO-FT. The application was examined against the requirements of the Framework, and it was decided to accord recognition to the UFF (CIN No. U91990KA2016NPL096977) as SRO-FT. RBI invites comments on the Draft “Reserve Bank of India (Know Your Customer) Amendment Directions, 2026” The Reserve Bank in its Know Your Customers (KYC) Directions, 2025 has issued instructions on 'Operations of Bank Accounts and Money Mules'. The Hon'ble Supreme Court in its order dated August 4, 2026, has directed the Reserve Bank to adopt and circulate a Standard Operating Procedure (SOP) prescribing the action to be taken by banks for placing temporary debit holds on amounts or accounts linked to money-mule activity and cyber-enabled fraud. Accordingly, the Reserve Bank has issued the following draft Amendment Directions for public comments, which propose to amend existing instructions on Operations of Bank Accounts and Money Mules as prescribed in its KYC Directions, 2025 and advise the banks on the action to be taken for placing temporary debit holds on amounts or accounts linked to money-mule activity and cyber-enabled financial fraud as per the SOP. i. Reserve Bank of India (Know Your Customer) Amendment Directions, 2026 For the purpose of public consultation / feedback, a consolidated draft Amendment Directions applicable to all Commercial Banks (including Small Finance Banks, Payments Banks, Regional Rural Banks and Local Area Banks) and Urban Cooperative Banks is being issued. Upon examination of the feedback received, final Directions will be issued separately for the above type of regulated entities. To read more, please click here. Eight NBFCs surrender their Certificate of Registration to the RBI Eight Non-Banking Financial Companies (NBFC) have surrendered the Certificate of Registration (CoR) granted to them by the Reserve Bank of India (RBI). The RBI, in exercise of powers conferred on it under Section 45-IA (6) of the Reserve Bank of India Act, 1934, has therefore cancelled their CoR. To read more, please click here. RBI cancels Certificate of Registration of 5 NBFCs The Reserve Bank of India, vide Press Release dated September 17, 2026, has informed that in exercise of powers conferred on it under Section 45-IA (6) of the Reserve Bank of India Act, 1934, it has cancelled the Certificate of Registration of five NBFCs. To read more, please click here. RBI issues Directions on Minimum Capital Requirements for Market Risk under Basel III for Commercial Banks The Reserve Bank had issued Draft Guidelines on Minimum Capital Requirements for Market Risk – under Basel III on February 17, 2023, seeking stakeholder feedback. The draft guidelines proposed adoption of the Simplified Standardised Approach (SSA) for computing capital requirement for market risk under the revised Basel III framework. Feedback received on the draft guidelines has been examined and consequent modifications have been suitably incorporated in the final Directions. Statement on the feedback received on the draft guidelines is provided in the Annex. Accordingly, the Reserve Bank of India has issued the Reserve Bank of India (Commercial Banks - Minimum Capital Requirements for Market Risk) Directions, 2026. The Directions aim to align the market risk guidelines with the revised Basel III framework, as part of RBI’s adoption of the Basel standards, while ensuring simplicity of regulations, providing flexibility, and ease of adoption. The Directions will take effect from April 1, 2027, ensuring sufficient lead time for banks. It may be noted that to ensure smooth transition, intermediate (transition) scalars have been in effect since April 1, 2024. The major changes in the final Directions vis-à-vis the draft guidelines are summarised below: (1) Scope of the trading book: Since the Investment Directions provide a clearly identifiable trading book under ‘Held for Trading (HFT)’ accounting sub-classification, the instructions on the definition of the trading book have been deleted from the final Directions, and a reference has been made to the Investment Directions. (2) Net Open Position and forex risk capital charge: Revised instructions as provided in the Reserve Bank of India (Commercial Banks - Prudential Norms on Capital Adequacy) Tenth Amendment Directions, 2026 have been suitably incorporated. (3) Specific risk capital charge for interest rate risk: The specific risk tables for interest rate risk have been revised to align with the Basel Committee on Banking Supervision (BCBS) guidelines, which also provides a more concise and clean treatment. (4) Debt mutual funds / exchange traded funds (ETF) held in the trading book: The capital treatment has been revised to ensure capital computation is based on the underlying risk drivers while ensuring sufficient guardrails. (5) Specific risk capital requirement for positions hedged by credit derivatives: The instructions have been revised to include the treatment for positions hedged by total return swaps, permitted in terms of Master Direction – Reserve Bank of India (Credit Derivatives) Directions, 2026. To read, please click here. II. Supervision Supervisory Data Quality Index for Scheduled Commercial Banks (June 2026) The Reserve Bank has released the Supervisory Data Quality Index (sDQI) for SCBs for June 2026. It measures data quality in terms of Accuracy, Timeliness, Completeness and Consistency in the submission of returns and microdata for supervisory assessments. The objective of sDQI is to assess the adherence to the principles enunciated in the Reserve Bank of India (Commercial Banks – Supervisory Returns) Directions, 2026 and Reserve Bank of India (Small Finance Banks - Supervisory Returns) Directions, 2026. III. Financial Markets Issuance Calendar for Marketable Dated Securities for October 2026 - March 2027 In order to enable institutional and retail investors to plan their investments efficiently and to provide transparency and stability to the Government Securities Market, the Reserve Bank, in consultation with the Government of India, has released the indicative calendar for issuance of Government of India dated securities, including Sovereign Green Bonds (SGrBs), for the second half of the fiscal year 2026-27 (October 01, 2026, to March 31, 2027). To read more, please click here. WMA Limit for Government of India for October 2026 – March 2027 The Reserve Bank, in consultation with the Government of India, has decided that the limit for Ways and Means Advances (WMA) for the second half of the financial year 2026-27 (October 2026 to March 2027) will be ₹50,000 crore. The Reserve Bank may trigger fresh floatation of market loans when the Government of India utilises 75 per cent of the WMA limit. The Reserve Bank, in consultation with the Government of India, retains the flexibility to revise the WMA limit at any time taking into consideration the prevailing circumstances. The interest rate on WMA/Overdraft will be as under: WMA: Repo Rate Overdraft: Two percent above the Repo Rate Report of the Advisory Committee on Ways and Means Advances to State Governments The Reserve Bank has placed on its website the Report of the Advisory Committee on Ways and Means Advances (WMA) to State Governments. The Reserve Bank had constituted an Advisory Committee, under the Chairmanship of Shri I S N Prasad, former Additional Chief Secretary, Government of Karnataka. The terms of reference of the Advisory Committee included, inter alia, review of State-wise WMA limits and other financial accommodation facilities available to the States. The Committee has made various recommendations which shall be examined by the Reserve Bank. IV. Publications RBI Bulletin – September 2026 The Reserve Bank has released the September 2026 issue of its monthly Bulletin. The Bulletin includes seven speeches, three articles and current statistics. The three articles are: I. State of the Economy; II. Credit-Deposit Divergence: A Balance Sheet Decomposition; and III. Private Corporate Investment: Growth in 2025-26 and Outlook for 2026-27. State of the Economy With geopolitical tensions re-escalating in West Asia, the global economy is again confronted with rising energy prices, and increased volatility across various segments of the financial markets. Notwithstanding the ongoing global turbulence, the Indian economy recorded robust growth of 7.8 per cent in Q1:2026-27. The economy also demonstrated resilience through August as evident from high frequency indicators. Supported by strong export growth, the merchandise trade deficit narrowed. Headline inflation inched up to 4.8 per cent in August, driven by the food and beverages group along with a pickup in fuel and core components. System liquidity surplus surged following FCNR(B) deposit flows. A moderate current account deficit in Q1:2026-27 and strong FDI flows supported the external sector, and foreign exchange reserves reached an all time high. To read more, please click here. Developments in India’s Balance of Payments during the First Quarter (April-June) of 2026-27 Key Features of India’s BoP in Q1:2026-27 I. India’s current account deficit stood at US$ 4.2 billion (0.5 per cent of GDP) in Q1:2026-27 as compared to US$ 3.4 billion (0.4 per cent of GDP) in Q1:2025-26. II. Merchandise trade deficit at US$ 86.1 billion in Q1:2026-27 was higher than US$ 68.9 billion in Q1:2025-26. III. Net services receipts increased to US$ 51.6 billion in Q1:2026-27 from US$ 47.9 billion a year ago. IV. Services exports have risen on a year-on-year basis in major categories such as computer services, other business services and transportation services. V. Net outgo on the primary income account, mainly reflecting payments of investment income, decreased to US$ 10.5 billion in Q1:2026-27 from US$ 13.3 billion in Q1:2025-26. VI. Personal transfer receipts under secondary income account, mainly representing remittances by Indians employed overseas, rose to US$ 42.9 billion in Q1:2026-27 from US$ 33.2 billion in Q1:2025-26. VII. In the financial account, foreign direct investment (FDI) recorded a net inflow of US$ 6.1 billion in Q1:2026-27, higher than US$ 5.2 billion in Q1:2025-26. VIII. Foreign portfolio investment (FPI) recorded a net outflow of US$ 9.6 billion in Q1:2026-27 as against a net inflow of US$ 1.6 billion in Q1:2025-26. IX. Non-resident deposits (NRI deposits) recorded a net inflow of US$ 2.8 billion in Q1:2026-27 as compared to US$ 3.6 billion in Q1:2025-26. X. Net inflows under external commercial borrowings (ECBs) to India amounted to US$ 3.3 billion in Q1:2026-27 as compared to US$ 4.4 billion in Q1:2025-26. XI. Foreign exchange reserves depleted by US$ 8.1 billion (on a BoP basis) in Q1:2026-27 as against an accretion of US$ 4.5 billion in Q1:2025-26 To read more, please click here. Sources of Variation in India’s Foreign Exchange Reserves during April-June 2026 The Reserve Bank released the balance of payments (BoP) data for the first quarter (Q1), i.e., April-June of 2026 on its website (www.rbi.org.in). On a balance of payments basis (i.e., excluding valuation effects), foreign exchange reserves decreased by US$ 8.1 billion during April-June 2026 as against an accretion of US$ 4.5 billion during April-June 2025. Foreign exchange reserves in nominal terms (i.e., including valuation effects) decreased by US$ 22.5 billion during April-June 2026 as against an accretion of US$ 29.8 billion in April-June 2025. To read more, please click here. V. Data Release & Surveys Important data and surveys released by the Reserve Bank during the month of September 2026 are as follows:
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