No longer current — withdrawn, no replacement on file yet
Source: Reserve Bank of India · RBI/2008-09/356 · issued 21 Jan 2009 · ~1 min read
Quick answerNon-scheduled Tier-I UCBs can keep up to 7.5% of NDTL in interest-bearing deposits with SBI, its subsidiaries, public sector banks, or Industrial Development Bank of India Ltd. instead of government securities, but this exemption ends on April 1, 2010.
The rule, in the simplest words
Non-scheduled Tier-I UCBs can keep up to 7.5% of their deposits (NDTL) in interest-earning bank deposits (including with IDBI Ltd.) instead of government bonds, but only until March 31, 2010.
How it plays out — a real example
Ravi, the treasurer of a small non-scheduled UCB in Tier I, currently holds 12% of NDTL in SBI deposits. He must reduce that to 7.5% by October 1, 2009, and move the rest into government securities before April 2010. (Note: Deposits with IDBI Ltd. are also eligible.)
What changed
Previously, non-scheduled Tier-I UCBs could hold up to 15% of NDTL in interest-bearing deposits with specified banks (including IDBI Ltd.) as an alternative to SLR in government securities. Now, from October 1, 2009, this exemption is capped at 7.5% of NDTL, and it will be fully withdrawn from April 1, 2010.
What it means for you
UCBs must plan to shift their SLR holdings back to government or approved securities by April 2010. The phased reduction gives banks time to adjust their investment portfolios and liquidity management. Non-compliance after the deadline could attract penalties under the Banking Regulation Act.
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
Review your current SLR composition and ensure the exemption portion does not exceed 7.5% of NDTL from October 1, 2009.
Prepare a transition plan to fully comply with SLR requirements in government/approved securities by April 1, 2010.
Coordinate with your treasury team to reallocate funds from interest-bearing deposits to eligible securities before the deadline.
Acknowledge receipt of this circular to your regional RBI office.
Who it affects
Non-scheduled Tier-I Primary (Urban) Co-operative Banks, Treasury departments of affected UCBs, Compliance officers at UCBs
❓ Common questions
Regulatory timeline
Decoded by BankPulse2026-07-30 04:02 IST
repealed_by — Consolidation of Regulations — Withdrawal of circulars (28 Nov 2025)
Status change: withdrawn05 Aug 2026, 04:00 IST
Built from our lineage records — each fact carries its provenance; missing history simply is not shown (never guessed).
Can we still use interest-bearing deposits with SBI or public sector banks?
Yes, but only up to 7.5% of NDTL until March 31, 2010. After that, all SLR must be in government or approved securities. Deposits with Industrial Development Bank of India Ltd. are also allowed.
📜 This document’s life story (1 recorded event, each backed by RBI’s own words)
Repealed byRBI/2025-26/100 — Consolidation of Regulations — Withdrawal of circulars (28 Nov 2025)
RBI’s words: “Official withdrawal register entry #1990: UBD.(PCB).Cir.No.37/16.26.000/2008-09 — "Banking Regulation Act 1949 (AACS) - Investments in Government and Other Approved Securities by UCBs - Exemption unde”
📜 Read the original circular — full text as issued by RBI
Reproduced for reference with acknowledgment — Source: Reserve Bank of India · RBI/2008-09/356 · issued 21 Jan 2009. The plain-English explanation above is BankPulse’s own independent summary.
Discuss this circular with fellow bankers — reply, upvote what helps, report what doesn’t belong. Be professional; no client data. Views are the commenter’s own, not BankPulse’s.
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=4780&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.
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