The Reserve Bank of India (RBI) on November 28, 2025, issued the Reserve Bank of India (Local Area Banks – Managing Risks in Outsourcing) Directions, 2025.
The following has been stated: -
•The RBI (Local Area Banks – Managing Risks in Outsourcing) Directions, 2025 require banks to maintain Board-approved policies and robust oversight over IT outsourcing, ensuring accountability, risk management, and regulatory compliance.
•Banks must conduct due diligence on service providers, safeguard customer data, and implement business continuity and exit strategies.
•Specific provisions cover outsourcing within groups, cross-border arrangements, Security Operations Centres, and cloud services, emphasizing data security, access control, and compliance with legal and regulatory requirements.
•Continuous monitoring, audits, and risk assessments are mandated to protect operations and customer interests.
These directions shall become effective on November 28, 2025.
[Notification No.:RBI/DOR/2025-26/245 DOR.ORG.REC.No.164/21-04-158/2025-26]
