What changed
Previously, banks had to get the licence amended by the concerned RBI Regional Office before shifting. Now, banks can proceed with the shift first and submit the licence for address incorporation within three months.
What it means for you
This reduces administrative delays for branch relocations, giving banks more operational flexibility. However, banks must ensure rural branches continue to serve allocated villages under the Service Area Approach. Non-compliance with the three-month licence submission timeline could invite regulatory scrutiny.
What you must do
- Shift branches within the same municipal ward/locality (metropolitan/urban/semi-urban) or block/service area (rural) without prior RBI approval.
- Ensure rural relocated branches adequately serve villages allocated under Service Area Approach.
- Submit the branch licence to the concerned RBI Regional Office for address update within three months of shifting.
- Maintain records of shifting dates and licence submissions for audit readiness.
Who it affects
All Scheduled Commercial Banks (excluding RRBs), Branch operations teams, Compliance departments
Can we shift a branch to a different city without prior approval?
No, this circular only allows shifting within the same municipal ward/locality in urban/semi-urban centres or within the same block/service area in rural centres. Inter-city shifts still require prior RBI approval.
What happens if we fail to submit the licence within three months?
The circular does not specify penalties, but non-compliance may lead to regulatory action. It is advisable to adhere to the timeline to avoid issues.