Home › Circulars › RBI/2006-2007/311

CRR hike for Urban Co-op Banks: 6.50% by April 28, 2007

Current & verified — this is the latest version

Source: Reserve Bank of India · RBI/2006-2007/311 · issued 05 Apr 2007 · ~1 min read

Quick answerRBI raised CRR for Scheduled Primary (Urban) Co-operative Banks by 0.50% to 6.50% in two stages from April 14, 2007. Interest on eligible CRR balances cut to 0.50% per annum. Effective from fortnights beginning April 14 and April 28, 2007.

The rule, in the simplest words

CRR (money banks must keep with RBI) for urban co-op banks goes up by 0.50% in two steps: first to 6.25% on April 14, then to 6.50% on April 28, 2007.
Interest RBI pays on this kept money drops from 1.00% to 0.50% per year starting April 14, 2007.
The minimum CRR floor of 3.00% on total deposits still applies.
This change affects only Scheduled Primary (Urban) Co-operative Banks, not other banks.
Banks must follow the new rates for the fortnights (two-week periods) starting on those dates.

How it plays out — a real example

Ravi, the treasurer of a large urban co-op bank in Mumbai, updates his CRR calculation spreadsheet for the fortnight starting April 14, 2007. He sets aside 6.25% of NDTL instead of the previous 5.75%, and notes that the interest income on that balance will now be only 0.50% per annum, reducing his treasury earnings.

What changed

CRR increased by 0.50 percentage points in two equal steps: to 6.25% from April 14, 2007, and to 6.50% from April 28, 2007. Interest paid on eligible CRR balances reduced from 1.00% to 0.50% per annum effective April 14, 2007.

What it means for you

Urban co-operative banks must set aside more funds with RBI, reducing lendable resources. The lower interest rate on CRR balances further squeezes earnings on idle cash. Banks need to adjust liquidity planning and may face margin pressure.

What you must do

Recalculate CRR requirement on NDTL for fortnights starting April 14 and April 28, 2007.
Ensure incremental CRR of 0.25% each fortnight is maintained without fail.
Update internal systems to reflect reduced interest rate of 0.50% on eligible CRR balances.
Communicate the changes to treasury and compliance teams immediately.

Who it affects

Scheduled Primary (Urban) Co-operative Banks, Treasury departments of UCBs, Compliance officers at UCBs

❓ Common questions

Regulatory timeline

Stated effective date effective April 14, 2007
Decoded by BankPulse 2026-07-28 04:07 IST

Built from our lineage records — each fact carries its provenance; missing history simply is not shown (never guessed).

What is the new CRR rate for urban co-operative banks from April 28, 2007?

The CRR will be 6.50% of Net Demand and Time Liabilities (NDTL) from the fortnight beginning April 28, 2007.

Why is the interest on CRR balances being reduced?

RBI decided to lower the interest rate on eligible cash balances from 1.00% to 0.50% per annum, effective April 14, 2007, as part of monetary tightening.

Is there any minimum CRR floor still applicable?

Yes, the effective CRR on total Demand and Time Liabilities must not fall below 3.00% as per the RBI Act, 1934.

📜 Read the original circular — full text as issued by RBI

Notifications - Reserve Bank of India Skip to main content Selected Selected Change Language हिंदी Search the Website Search Home About Us ▼ About Us Organisation & Functions ▶ Organisation Structure Departments Offices Training Establishment ▶ College of Agricultural Banking Reserve Bank Staff College College of Supervisors RBI's Functions and Working Governors Deputy Governors Executive Directors Communication Policy of RBI Sources of Information ▶ Annual Publications Half-yearly Publications Quarterly Publications Monthly Publications Weekly Publications Occasional Publications SDDS NSDP Data Releases Publications available on Subscription General Information RBI History Museum ▶ The RBI Museum RBI Monetary Museum Notification ▼ Notifications Master Directions Master Circulars Amendment Directions Draft Notifications/Guidelines ▶ Draft Notifications/Guidelines Draft Directions (RE-wise) Index To RBI Circulars Standalone Circulars Circulars Withdrawn Press Releases Speeches & Media Interactions ▼ Speeches Media Interactions Memorial Lectures Podcasts Publications ▼ Biennial Annual Half-Yearly Quarterly Bi-monthly Monthly Weekly Occasional Reports Working Papers Legal Framework ▼ Act Rules Regulations Schemes Research ▼ External Research Schemes RBI Occasional Papers Working Papers RBI Bulletin History DRG Studies KLEMS State Statistics and Finances Statistics ▼ Data Releases Database on Indian Economy Public Debt Statistics Regulatory Reporting ▼ List of Returns Data Definition Validation rules/ Taxonomy List of RBI Reporting Portals FAQs of RBI Reporting Portals Home Notifications Notifications ( 61 kb ) UCBs – Maintenance of CRR RBI/2006-2007/311 Ref: UBD (PCB).No./5 /12.03.000/2006-07 April 05, 2007 The Chief Executive Officers of All Scheduled Primary (Urban) Co-operative Banks Dear Sir, Section 42(1) of Reserve Bank of India Act, 1934- Maintenance of Cash Reserve Ratio (CRR) Please refer to our Circular UBD (PCB) Cir. No.3/12.03.000/2006-07 dated March 01, 2007 on the captioned subject. As set out in the Press Release 2006-2007/1336 dated March 30, 2007, it has been decided to increase the Cash Reserve Ratio (CRR) of Scheduled Primary (Urban) Co-operative Banks by one-half of one percentage point of their Net Demand and Time Liabilities (NDTL) in two stages, effective from the fortnights indicated below: Effective Date ( i.e. , the fortnight beginning from) CRR on net demand and time liabilities (per cent) April 14, 2007 6.25 April 28, 2007 6.50 However, the effective CRR required to be maintained by Scheduled Primary (Urban) Co-operative Banks on total Demand and Time Liabilities shall not be less than 3.00 per cent, as stipulated under the Reserve Bank of India Act, 1934. 2. A copy of the relevant notification UBD (PCB) No./5/12.03.000/2006-07 dated April 05, 2007 is enclosed. 3. Interest on eligible cash balances for CRR At present all Scheduled Primary (Urban) Co-operative Banks are paid interest at the rate of 1.00 percent on eligible cash balances maintained with Reserve Bank of India under the provisio to section 42 (1) and 42 (1A) of the Reserve Bank of India Act, 1934. It has now been decided that with effect from the fortnight beginning April 14, 2007, all Scheduled Primary (Urban) Co-operative Banks will be paid interest at the rate of 0.50 percent per annum on eligible cash balances maintained with Reserve Bank of India under current CRR requirement. 4. Please acknowledge receipt. Yours faithfully, (A.K.Khound) Chief General Manager 2026 All Months January February March April May June July August September October November December 2025 All Months January February March April May June July August September October November December 2024 All Months January February March April May June July August September October November December 2023 All Months January February March April May June July August September October November December 2022 All Months January February March April May June July August September October November December 2021 All Months January February March April May June July August September October November December 2020 All Months January February March April May June July August September October November December 2019 All Months January February March April May June July August September October November December 2018 All Months January February March April May June July August September October November December 2017 All Months January February March April May June July August September October November December Archives 2016 All Months January February March April May June July August September October November December 2015 All Months January February March April May June July August September October November December 2014 All Months January February March April May June July August September October November December 2013 All Months January February March April May June July August September October November December 2012 All Months January February March April May June July August September October November December 2011 All Months January February March April May June July August September October November December 2010 All Months January February March April May June July August September October November December 2009 All Months January February March April May June July August September October November December 2008 All Months January February March April May June July August September October November December 2007 All Months January February March April May June July August September October November December 2006 All Months January February March April May June July August September October November December 2005 All Months January February March April May June July August September October November December 2004 All Months January February March April May June July August September October November December 2003 All Months January February March April May June July August September October November December 2002 All Months January February March April May June July August September October November December 2001 All Months January February March April May June July August September October November December 2000 All Months January February March April May June July August September October November December 1999 All Months January February March April May June July August September October November December 1998 All Months January February March April May June July August September October November December 1997 All Months January February March April May June July August September October November December 1996 All Months January February March April May June July August September October November December 1995 All Months January February March April May June July August September October November December 1994 All Months January February March April May June July August September October November December 1993 All Months January February March April May June July August September October November December 1992 All Months January February March April May June July August September October November December 1991 All Months January February March April May June July August September October November December Top Back to previous page More Links Bank Holidays Banking Glossary Citizen's Charter Complaints Contact Us COVID-19 Measures E-LMS Events FAQs Financial Education Forms IFSC/MICR Codes Important Websites Opportunities @ RBI RBI Clarifications RBI Kehta Hai RBI’s Vision and Values (1257 kb)--> Right to Information Act Tenders Follow RBI RSS Twitter YouTube Instagram Facebook LinkedIn © Reserve Bank of India. 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Reproduced for reference with acknowledgment — Source: Reserve Bank of India · RBI/2006-2007/311 · issued 05 Apr 2007. The plain-English explanation above is BankPulse’s own independent summary.

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Who does what — compliance checklist

💻 IT / Systems

Update internal systems to reflect reduced interest rate of 0.50% on eligible CRR balances.

📜 Compliance

Recalculate CRR requirement on NDTL for fortnights starting April 14 and April 28, 2007.
Ensure incremental CRR of 0.25% each fortnight is maintained without fail.
Communicate the changes to treasury and compliance teams immediately.

Grouped from the action items above — a single circular may involve more than one team.

Worked example & action-note template

Example: if you are a Compliance officer at a bank this circular applies to (Scheduled Primary (Urban) Co-operative Banks, Treasury departments of UCBs, Compliance officers at UCBs), your first concrete step on “CRR hike for Urban Co-op Banks: 6.50% by April 28, 2007” is: “Recalculate CRR requirement on NDTL for fortnights starting April 14 and April 28, 2007.” (RBI issued this 05 Apr 2007).

Circular: RBI/2006-2007/311 -- CRR hike for Urban Co-op Banks: 6.50% by April 28, 2007
Issued: 05 Apr 2007
Action required: Recalculate CRR requirement on NDTL for fortnights starting April 14 and April 28, 2007.
Action required: Ensure incremental CRR of 0.25% each fortnight is maintained without fail.
Action required: Update internal systems to reflect reduced interest rate of 0.50% on eligible CRR balances.
Action required: Communicate the changes to treasury and compliance teams immediately.
Owner: ____________ Target date: ____________
Board/committee approval needed? Y / N
Evidence filed in compliance register on: ____________

Built only from this circular’s own published fields — not legal advice; always confirm against the official RBI source.

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BankPulse Compliance Evidence Pack — generated 05 Aug 2026 · status cross-checked against RBI’s official withdrawal register (refreshed weekly).
Official RBI source: https://www.rbi.org.in/Scripts/NotificationUser.aspx?Id=3395&Mode=0 — Plain-English summary by BankPulse (bankpulse.ai), reviewed by our expert reviewer, CA Amit Jain. Independent platform, not affiliated with the Reserve Bank of India; is our own plain-English paraphrase, not RBI’s original wording.