Home › Circulars › RBI/2006-2007/342

CRR Rules for RRBs: Floor Removed, Rates Unchanged

No longer current — withdrawn, no replacement on file yet

Source: Reserve Bank of India · RBI/2006-2007/342 · issued 24 Apr 2007 · ~2 min read

Quick answerRBI removed the statutory 3% CRR floor for RRBs from April 1, 2007, and can now prescribe CRR without any floor or ceiling. Current CRR rates remain at 6.25% (from April 14) and 6.50% (from April 28), with no interest paid on CRR balances from March 31, 2007.

What changed

The statutory minimum CRR of 3% of net demand and time liabilities for RRBs was eliminated effective April 1, 2007, following the RBI (Amendment) Act, 2006. RBI now has full discretion to set CRR for RRBs without any floor or ceiling. Additionally, interest payment on CRR balances maintained by RRBs was discontinued from the fortnight beginning March 31, 2007.

What it means for you

RRBs lose the guaranteed 3% floor, giving RBI flexibility to raise or lower CRR as needed for monetary stability. The removal of interest on CRR balances increases the cost of holding reserves for RRBs, directly impacting their net interest margins. Banks must adjust liquidity management as CRR can now be changed without statutory limits.

Historical instruction — do not use for current compliance. This is what was required at the time; it no longer reflects current RBI requirements. If no replacement rule is linked above, that only means none is recorded on our register yet — it does not prove no later applicable rule exists. Confirm on the official RBI source below.

What banks were required to do at the time

Update internal CRR compliance systems to reflect removal of the 3% statutory floor and new discretionary regime.
Prepare for potential CRR rate changes without prior floor protection; monitor RBI announcements closely.
Adjust liquidity planning to account for zero interest on CRR balances from March 31, 2007 onward.
Ensure accurate calculation of net demand and time liabilities for CRR maintenance at 6.25% and 6.50% as per schedule.

Who it affects

Regional Rural Banks (RRBs), Treasury and ALM teams at RRBs, RBI's monetary policy implementation for RRBs

❓ Common questions

Regulatory timeline

Stated effective date effective April 1, 2007
Decoded by BankPulse 2026-06-19 17:13 IST
repealed_by — Consolidation of Regulations — Withdrawal of circulars (28 Nov 2025)
Status change: withdrawn 05 Aug 2026, 04:00 IST

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

Why did RBI remove the 3% CRR floor for RRBs?

The floor was removed as part of the RBI (Amendment) Act, 2006, which came into force on April 1, 2007, to give RBI greater flexibility in setting CRR for monetary stability without statutory constraints.

What are the current CRR rates for RRBs after this change?

RRBs must maintain CRR at 6.25% of net demand and time liabilities from the fortnight beginning April 14, 2007, and 6.50% from April 28, 2007, as per the circular.

Will RRBs receive interest on CRR balances now?

No, interest payment on CRR balances maintained by RRBs was discontinued with effect from the fortnight beginning March 31, 2007, following the amendment.

📜 This document’s life story (1 recorded event, each backed by RBI’s own words)

Repealed by RBI/2025-26/100 — Consolidation of Regulations — Withdrawal of circulars (28 Nov 2025)

RBI’s words: “Official withdrawal register entry #2460: RPCD.RRB.CO.BC.No.73/03.05.28(B)/2006-07 — "Section 42(1) of Reserve Bank of India Act, 1934 - Maintenance of Cash Reserve Ratio (CRR)" dated April 24, 2007”

📜 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 ( 527 kb ) Maintenance of CRR – RRBs RBI/2006-2007/342 RPCD.RRB.CO.BC.No.73/03.05.28(B)/2006-07 April 24, 2007 All Regional Rural Banks Dear Sir, Section 42(1) of Reserve Bank of India Act, 1934 – Maintenance of Cash Reserve Ratio (CRR) Please refer to our Circulars RPCD.RRB.CO.BC.No.51/03.05.28(B)/2006-07 dated March 02, 2007 and RPCD.RRB.CO.BC.No.66/03.05.28(B)/2006-07 dated April 04, 2007 on the captioned subject. Government of India in their Extraordinary Gazette notification No.S.O.337(E) dated March 9, 2007 have notified April 01, 2007 as the date on which the provisions of Section 3 of the Reserve Bank of India (Amendment) Act, 2006 shall come into force. Consequent upon the provisions of Section 3 of the Reserve Bank of India (Amendment) Act, 2006 coming into force, the amendment carried out to sub-Section (1) of Section 42 of Reserve Bank of India Act, 1934 has been brought into force with effect from April 01,2007. Accordingly, the statutory minimum CRR requirement of 3 per cent of total demand and time liabilities no longer exists with effect from the said notified date. The Reserve Bank of India, having regard to the needs of securing the monetary stability in the country, may from time to time prescribe the CRR for Regional Rural Banks without any floor and ceiling rate. 2. In exercise of the powers conferred on the Reserve Bank of India, it has been decided to continue the status quo on the rate of CRR to be maintained by Regional Rural Banks and the extant exemptions which will be operative till further changes are notified. Accordingly, Regional Rural Banks shall continue to maintain CRR on their total demand and time liabilities, subject to the exemptions as indicated in our circular RPCD.CO.RRB.BC.No.72/03.05.28(B)/2006-07 dated April 24, 2007 from the fortnights as detailed below: Effective date (i.e., thefortnight beginning from) CRR on net demand and time liabilities (per cent) April 14, 2007 6.25 April 28, 2007 6.50 3. Further, in view of Section 3 of the Reserve Bank of India (Amendment) Act, 2006 coming into force, sub-section (1B) of Section 42 of the Reserve Bank of India Act, 1934 stands omitted with effect from April 01, 2007. Consistent with the amendment and in partial modification of our Circulars RPCD.RRB.CO.BC.No.51/03.05.28(B)/2006-07 dated March 02, 2007 and RPCD.RRB.CO.BC.No.66/03.05.28(B)/2006-07 dated April 04, 2007, it has been decided that with effect from the fortnight beginning March 31, 2007, the Reserve Bank of India will not be paying any interest on the CRR balances maintained by Regional Rural Banks. 4. A copy of the relative notification RPCD.CO.RRB.No.9945/03.05.28(B)/2006-07 dated April 24, 2007 is enclosed. 5. Please acknowledge receipt to our Regional Office concerned. Yours faithfully (Surekha Marandi) 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 &copy; Reserve Bank of India. 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Reproduced for reference with acknowledgment — Source: Reserve Bank of India · RBI/2006-2007/342 · issued 24 Apr 2007. The plain-English explanation above is BankPulse’s own independent summary.

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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=3451&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.