Source: Reserve Bank of India · RBI/2008-2009/79 · issued 01 Jul 2008 · ~1 min read
Quick answerRBI consolidated all existing guidelines on bank guarantees and co-acceptances into a single master circular as of July 1, 2008, applicable to all scheduled commercial banks except RRBs. It covers norms, fraud precautions, and foreign exchange regulations.
What changed
RBI updated its previous master circular dated July 2, 2007 by incorporating all instructions issued up to June 30, 2008 on guarantees and co-acceptances. The circular consolidates existing rules into one document without introducing new requirements.
What it means for you
Banks must now refer to this single master circular for all guidelines on guarantee business, including norms for unsecured advances, fraud prevention, and foreign exchange-related guarantees. It reinforces the need for robust internal controls and risk management in off-balance sheet exposures.
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 and update your bank's internal policies on guarantees and co-acceptances to align with this master circular.
Ensure all guarantee-related staff are trained on the consolidated guidelines, especially fraud prevention measures.
Verify compliance with the norms for unsecured advances and guarantees, including those for directors and brokers.
Check that foreign exchange guarantee procedures adhere to the Foreign Exchange Management (Guarantees) Regulations.
Who it affects
All scheduled commercial banks (excluding RRBs), Credit and risk management departments, Trade finance and guarantee processing teams, Compliance and audit functions
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).
Does this circular introduce any new rules for guarantees?
No, it consolidates all existing instructions issued up to June 30, 2008 into one master circular, replacing the previous version from July 2, 2007.
Are Regional Rural Banks covered by this circular?
No, the circular explicitly excludes Regional Rural Banks (RRBs) from its application.
What key areas are covered in the guidelines?
The circular covers general guidelines, conduct of guarantee business, foreign exchange regulations, restrictions on inter-company deposits/loans, payment of invoked guarantees, co-acceptance of bills, and precautions for letters of credit.
📜 This document’s life story (2 recorded events, each backed by RBI’s own words)
RBI’s words: “Please refer to the Master Circular DBOD.No.Dir.BC.18/13.03.00/2008-09 dated July 1, 2008 updating instructions/ guidelines issued to banks till June 30, 2008”
Repealed byRBI/2025-26/100 — Consolidation of Regulations — Withdrawal of circulars (28 Nov 2025)
RBI’s words: “Official withdrawal register entry #2186: DBOD.No.Dir.BC.18/13.03.00/2008-09 — "Master Circular - Guarantees and Co-acceptances" dated July 1, 2008”
📜 Read the original circular — full text as issued by RBI
RBI/2008-2009/79
DBOD. No. Dir. BC. 18/13.03.00/2008-09
July 1, 2008
All Scheduled Commercial Banks
(excluding RRBs)
Dear Sir
Master Circular - Guarantees and Co-acceptances
Please refer to the Master Circular DBOD.No.Dir.BC.10/13.03.00/2007-08 dated July 2, 2007 updating instructions/ guidelines issued to banks till June 30, 2007 on matters relating to issue of Guarantees and Co-acceptances by banks. The Master Circular has been suitably updated by incorporating instructions issued on the subject up to June 30, 2008 and has also been placed on the RBI website ( http://www.rbi.org.in ). A copy of the Master Circular is enclosed.
Yours faithfully
(P. Vijaya Bhaskar)
Chief General Manager
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Reproduced for reference with acknowledgment — Source: Reserve Bank of India · RBI/2008-2009/79 · issued 01 Jul 2008. 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=4345&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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