Home › Circulars › RBI/2007-08/109

RRB CRR Hiked by 50 bps to 7% from Aug 4, 2007

No longer current — withdrawn, no replacement on file yet

Source: Reserve Bank of India · RBI/2007-08/109 · issued 01 Aug 2007 · ~1 min read

Quick answerRBI raised CRR for all Regional Rural Banks by 50 basis points to 7.00%, effective from the fortnight starting August 4, 2007. This tightens liquidity and increases the portion of deposits RRBs must hold as reserves.

The rule, in the simplest words

RBI raised the cash reserve ratio (CRR) for all Regional Rural Banks (RRBs) by 0.50% (50 basis points).
The new CRR is 7.00% of the bank's total demand and time liabilities (money people can withdraw anytime or after a fixed time).
This rule starts from the two-week period beginning August 4, 2007.
RRBs must keep this extra money with RBI, so they have less to lend to customers.
Exemptions from the old rule still apply unless changed.

How it plays out — a real example

Ravi, the treasurer of a Regional Rural Bank in Karnataka, checks the new RBI circular. He calculates that his bank's total demand and time liabilities are ₹500 crore. He must now set aside 7% (₹35 crore) as CRR instead of the previous 6.5% (₹32.5 crore), reducing lendable funds by ₹2.5 crore. He immediately adjusts the bank's liquidity plan and informs the loan department to tighten credit.

What changed

RBI increased the Cash Reserve Ratio (CRR) for all Regional Rural Banks by 50 basis points to 7.00%, effective from the fortnight beginning August 4, 2007, superseding the previous notification of April 24, 2007.

What it means for you

RRBs must now set aside a larger share of their demand and time liabilities as reserves with RBI, reducing lendable funds. This will compress net interest margins and may slow credit growth for rural lenders. Banks should recalibrate liquidity management and loan pricing to absorb the impact.

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

Recalculate CRR requirement at 7.00% of total demand and time liabilities for the fortnight starting August 4, 2007.
Adjust liquidity buffers and ensure sufficient funds are maintained with RBI to avoid penalties.
Review loan disbursement schedules and pricing to offset the impact of higher reserve costs.
Communicate the change to treasury and operations teams for compliance.
Acknowledge receipt of this circular to your respective RBI Regional Office.

Who it affects

All Regional Rural Banks (RRBs), Treasury departments of RRBs, Compliance officers at RRBs, Rural lending operations

❓ Common questions

Regulatory timeline

Decoded by BankPulse 2026-07-29 04:02 IST
partially_modified_by — RRB CRR Hiked by 50 bps to 7.50% from Nov 10, 2007
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).

What is the new CRR rate for RRBs?

The CRR for all Regional Rural Banks is increased to 7.00% of their total demand and time liabilities, effective from the fortnight beginning August 4, 2007.

Does this apply to all RRBs uniformly?

Yes, the circular applies to all Regional Rural Banks, with exemptions as per the earlier notification dated April 24, 2007.

What should RRBs do immediately?

RRBs must ensure compliance from the specified fortnight, recalculate reserve requirements, and acknowledge receipt to their RBI Regional Office.

📜 This document’s life story (2 recorded events, each backed by RBI’s own words)

Partially modified by RRB CRR Hiked by 50 bps to 7.50% from Nov 10, 2007

RBI’s words: “in partial modification of the notification RPCD.CO.RRB.No 16 /03.05.28(B) /2007-2008 dated August 01, 2007”

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

RBI’s words: “Official withdrawal register entry #2360: RPCD.CO.RRB.BC.17/03.05.28(B)/2007-08 — "Section 42 (1) of Reserve Bank of India Act, 1934 - Maintenance of Cash Reserve Ratio (CRR) - Regional Rural Banks (R”

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

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On a review of the current liquidity situation, it has been decided to increase Cash Reserve Ratio (CRR) of all Regional Rural Banks by 50 basis points to 7.00 per cent with effect from the fortnight beginning August 4, 2007. A copy the relative notification RPCD RRB.CO No. 16 / 03.05.28(B)/2007-08 dated August 1, 2007 is enclosed. Please acknowledge receipt to our Regional Office concerned. Yours faithfully, (Surekha Marandi) General Manager RPCD.CO.RRB.No.16/ 03.05.28(B)/2007-08 August 01, 2007 NOTIFICATION In exercise of the powers conferred under sub-section (1) of Section 42 of the Reserve Bank of India Act, 1934 and in partial modification of the notification RPCD.CO.RRB.No 9944 /03.05.28(B) /2006-2007 dated April 24, 2007, the Reserve Bank of India hereby notifies that every Regional Rural Bank should maintain a Cash Reserve Ratio (CRR) of 7.00 per cent of its total demand and time liabilities, subject to the exemptions as envisaged in the notification RPCD.CO.RRB.No.72/03.05.28(B)/2007-08 dated April 24, 2007 from the fortnight beginning August 04, 2007. (V.S.Das) Executive Director 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/2007-08/109 · issued 01 Aug 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=3751&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.