The Reserve Bank of India (RBI) on August 06, 2026, issued a press release: Review of Guidelines on Concentration Risk Management - Rural Cooperative Banks.
The following has been stated:
• The RBI has issued two draft Directions proposing changes to the regulatory framework for Rural Co-operative Banks (RCBs). The first draft proposes the RBI (Rural Co-operative Banks – Concentration Risk Management) Directions, 2026, while the second proposes amendments to the RBI (Rural Co-operative Banks – Credit Facilities) Directions, 2025.
• The proposed changes include prudential exposure limits for single and group counterparties, enhanced limits for housing loans, and prudential exposure limits for unsecured advances. Larger RCBs having deposits above ₹1,000 crore would be given greater flexibility to determine the tenor and moratorium period for housing loans, while the corresponding ceilings for other RCBs would also be increased.
• Further, RBI proposes to withdraw the prescribed sectoral exposure limits for most sectors, with the real estate sector being the exception. The proposals are intended to provide greater operational flexibility to RCBs while maintaining appropriate prudential safeguards against concentration and credit risks.
• Comments/feedback can be submitted by regulated entities, stakeholders and members of the public up to August 28, 2026.
[Press Release: 2026-2027/828]
