RBI Issues Draft Directions on Transaction Accounts, BSBD Accounts and Large Borrower Credit
SDG 8: Decent Work & Economic Growth | SDG 16: Peace, Justice & Strong Institutions
Institutions: Reserve Bank of India (RBI) | Ministry of Finance
The Reserve Bank of India has released three major draft regulatory documents for public comments, open until October 24, 2025, aimed at simplifying and standardising banking rules.
The most extensive set is the proposed Reserve Bank of India (Transaction Accounts) Directions, 2025, comprising seven separate directions for Commercial Banks, Small Finance Banks, Payments Banks, Regional Rural Banks, Local Area Banks, and both Urban and Rural Co-operative Banks. These aim to unify and streamline the rules governing current, savings, and overdraft accounts across the banking system, ensuring regulatory consistency and clarity.
A second draft, the Basic Savings Bank Deposit Account (BSBDA) Directions, 2025, updates rules for Indiaβs no-frills savings accounts, reinforcing their role as a cornerstone of financial inclusion. The directions propose wider digital access and affordable facilities to ensure continued relevance for low-income households.
Finally, RBI has floated a draft circular to repeal the 2017 guidelines on Enhancing Credit Supply for Large Borrowers through Market Mechanism, signalling a shift in how large corporate credit exposures are managed. This reflects changes in banking practices since the guidelines were introduced, with concentration risk now addressed through other frameworks such as the Large Exposures regime.
These measures show RBIβs intent to rationalise fragmented rules, simplify compliance, and modernise financial inclusion instruments. By bringing all transaction accounts under a common framework, updating BSBD accounts, and revisiting large borrower credit norms, RBI is aiming for a more consistent and transparent regulatory environment.
What is a BSBD Account? β A Basic Savings Bank Deposit (BSBD) account is a no-frills savings account with zero minimum balance and free basic facilities, designed to expand access to banking for low-income households.
Follow the full release here: RBI Press Release PRID 61344