In line with the announcements made in the Statement on Developmental and Regulatory Policies dated October 1, 2025, the Reserve Bank of India (RBI) has released several important draft Directions and Circulars for public consultation. These proposed regulations span multiple banking entities and key regulatory areas, aimed at strengthening governance, enhancing transparency, and streamlining operations across India’s financial system.
This consultative approach reflects RBI’s continued commitment to regulatory inclusiveness and stakeholder engagement.
1. Comprehensive Framework for Transaction Accounts
RBI has proposed a detailed set of Reserve Bank of India (Transaction Accounts) Directions, 2025, covering various categories of banking institutions. These include:
- Commercial Banks
- Small Finance Banks
- Regional Rural Banks
- Local Area Banks
- Urban Co-operative Banks
- Rural Co-operative Banks
- Payments Banks
Each draft direction under this umbrella aims to standardize practices around transaction accounts, which form the core of customer interaction with the banking system. These accounts are critical for maintaining liquidity, enabling digital payments, and ensuring financial inclusion.
By issuing tailored guidelines for different bank types, RBI ensures that the regulatory framework is contextual, relevant, and proportional, recognizing the varied customer bases and operational models these institutions serve.
2. Repeal of Guidelines on Credit Supply for Large Borrowers
RBI has also proposed the “Guidelines on Enhancing Credit Supply for Large Borrowers through Market Mechanism (Repeal Circular), 2025.” This draft signifies a reassessment of earlier guidelines aimed at limiting the concentration of credit exposure to large borrowers through mandatory bond market financing.
The repeal suggests a shift towards greater market flexibility and perhaps an evolving view on risk management, capital adequacy, and the depth of the domestic bond market. This change could pave the way for more nuanced, risk-based credit allocation, especially in a maturing financial ecosystem.
3. Revised Directions for Basic Savings Bank Deposit Accounts (BSBDA)
In another significant update, the Reserve Bank of India (Basic Savings Bank Deposit Account) Directions, 2025 have been issued in draft form. The BSBDA is a key tool for promoting financial inclusion, providing access to banking for low-income individuals with zero balance requirements and limited service charges.
The revised draft Directions aim to update and clarify operational guidelines for BSBDAs, likely incorporating feedback from years of implementation experience and technological advancements in banking services. Simplified KYC, interoperability, and digital access are expected to be key focus areas.
Public Feedback Invited Till October 24, 2025
In keeping with its consultative ethos, the RBI has invited comments and feedback from banks, market participants, and the public on these draft Directions and Circulars. Stakeholders can submit their responses via the ‘Connect 2 Regulate’ section on the RBI website. Alternatively, submissions can be made by post or email to the Department of Regulation, Central Office, RBI, Mumbai.
Final Thoughts
These draft Directions mark another step by the RBI toward building a modern, transparent, and inclusive financial regulatory framework. By involving stakeholders early in the regulatory process, RBI is not only ensuring that policies are grounded in operational reality but also reinforcing public trust in the financial system.
Interested parties should take this opportunity to engage, share insights, and help shape the future of banking in India.