What changed
RBI notified that American Express Banking Corp. has been included in the Second Schedule to the RBI Act, 1934. The inclusion was via notification DBOD IBD.No.8739/23.03.018/2008-09 dated December 4, 2008, published in the Gazette of India on December 27, 2008.
What it means for you
American Express Banking Corp. now qualifies as a scheduled commercial bank, bringing it under RBI's full regulatory framework. For other banks, this means a new competitor in the scheduled bank space, with implications for interbank operations and market dynamics.
What you must do
- Update your internal records to reflect American Express Banking Corp. as a scheduled bank.
- Review any existing or planned interbank arrangements with American Express Banking Corp. for compliance.
- Monitor RBI communications for any further operational guidelines related to this inclusion.
Who it affects
All scheduled commercial banks, American Express Banking Corp., RBI's supervisory and regulatory departments
What does inclusion in the Second Schedule mean for American Express Banking Corp.?
It means the entity is now a scheduled bank under the RBI Act, 1934, entitling it to certain privileges like access to RBI's refinance facilities and requiring it to maintain CRR and SLR as per RBI norms.
When did this inclusion take effect?
The notification was issued on December 4, 2008, and published in the Gazette of India on December 27, 2008. The circular communicating this to banks is dated February 5, 2009.
Does this affect other banks' operations?
Yes, other scheduled banks must now treat American Express Banking Corp. as a scheduled bank for interbank transactions, clearing, and regulatory reporting purposes.