The Reserve Bank of India (RBI) on April 01, 2026, issued the update to the Reserve Bank of India (Setting Up of Wholly Owned Subsidiaries by Foreign Banks) Guidelines, 2025.
The following has been updated:
• The update primarily consolidates various circulars and amendments issued during 2025–26 into the Master Direction, ensuring that all instructions are available in a single, updated document. It reflects alignment with recent changes under the Foreign Exchange Management Act, 1999, and newly issued regulations (including updated foreign exchange and guarantee frameworks), thereby maintaining consistency across RBI’s regulatory architecture.
• The revision also strengthens the role of Authorised Dealer (AD) banks by giving them greater operational clarity and responsibility in implementing compliance, reporting, and transaction monitoring requirements.
• Additionally, certain provisions have been rationalised or updated to remove duplication, improve ease of compliance, and reflect current practices in cross-border transactions and financial operations.
• Overall, the update ensures that the Master Direction remains a comprehensive, up-to-date, and principle-based regulatory framework, improving transparency and ease of doing business for regulated entities.
[Notification no. - RBI/DOR/2025-26/144]
