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CRR Cut for Urban Co-op Banks: 50 bps Reduction

Current · Source: Reserve Bank of India · RBI/2011-12/369 · issued 25 Jan 2012 · ~1 min read

Quick answerRBI reduced CRR for Scheduled Primary (Urban) Co-operative Banks by 50 bps from 6.00% to 5.50% of NDTL, effective fortnight starting January 28, 2012, as part of the Third Quarter Review of Monetary Policy 2011-12.

The rule, in the simplest words

Urban co-op banks must hold 5.50% of their net demand and time liabilities as cash with RBI.
This is a reduction of 50 bps from the previous 6.00% CRR.
The change takes effect from the fortnight starting January 28, 2012.

How it plays out — a real example

A co-operative bank branch officer in Indore, Mr. Kumar, is happy to see the reduced CRR as it means his bank can lend more to customers. He has been working hard to increase lending to small businesses in the city, and this change will help him achieve his goal. With the freed-up liquidity, Mr. Kumar's bank can now offer more loans to deserving customers, supporting the local economy.

What changed

The Cash Reserve Ratio (CRR) for Scheduled Primary (Urban) Co-operative Banks was reduced by 50 basis points, from 6.00% to 5.50% of their net demand and time liabilities (NDTL). This change takes effect from the fortnight beginning January 28, 2012, superseding the earlier CRR notification dated April 21, 2010.

What it means for you

Urban co-operative banks will now need to hold less cash with RBI, freeing up liquidity for lending or other deployment. This 50 bps cut directly improves their lendable resources and may support credit growth in the urban co-operative banking sector.

What you must do

Recalculate your CRR requirement at 5.50% of NDTL for the fortnight starting January 28, 2012.
Adjust your daily CRR maintenance to reflect the new lower average ratio.
Acknowledge receipt of this circular to your controlling office.
Update internal systems and reporting templates to the revised CRR rate.

Who it affects

All Scheduled Primary (Urban) Co-operative Banks, Treasury and ALM teams of UCBs, Compliance departments of UCBs

❓ Common questions

Regulatory timeline

Decoded by BankPulse 2026-06-18 22:02 IST
partially_modified_by — CRR Cut for Urban Co-op Banks: 75 bps Reduction

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

What is the effective date for the new CRR rate?

The reduced CRR of 5.50% applies from the fortnight beginning January 28, 2012.

Does this circular apply to all urban co-operative banks?

Yes, it applies to all Scheduled Primary (Urban) Co-operative Banks covered under Section 42(1) of the RBI Act, 1934.

What was the previous CRR rate before this cut?

The earlier CRR was 6.00% of NDTL, as per the circular dated April 21, 2010.

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

Partially modified by CRR Cut for Urban Co-op Banks: 75 bps Reduction

RBI’s words: “in partial modification of the earlier notification UBD.(PCB).DIR.No.6/12.03.000/2011-12 dated January 25, 2012”

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

RBI/2011-12/369

 UBD.BPD. (PCB). CIR.No. 2 /12.03.000/2011-12 

 January 25, 2012 

 The Chief Executive Officers of

 All Scheduled Primary (Urban) Co-operative Banks

 Dear Sir,

 Section 42(1) of Reserve Bank of India Act, 1934 –

 Maintenance of Cash Reserve Ratio (CRR) 

 Please refer to our Circular UBD (PCB).No.3/12.03.000/2009-10 dated April 21, 2010 on the captioned subject.

 2. The Reserve Bank in its Third Quarter Review of Monetary Policy 2011-12 issued on January 24, 2012 , decided to reduce the Cash Reserve Ratio (CRR) of Scheduled Primary (Urban) Co-operative Banks by 50 basis points from 6.00 per cent to 5.50 per cent of their net demand and time liabilities (NDTL), with effect from the fortnight beginning January 28, 2012.

 3. A copy of the relative notification UBD.(PCB).No./ 6 /12.03.000/2011-12 dated January 25, 2012 is enclosed .

 4. Please acknowledge receipt.

 Yours faithfully,

 (A. Udgata) 

 Chief General Manager-in-Charge

 Encl: 1

 UBD.BPD. (PCB). DIR.No. 6 /12.03.000/2011-12 

 January 25, 2012 

 Notification 

 In exercise of the powers conferred under the sub-section (1) of Section 42 of the Reserve Bank of India Act, 1934, and in partial modification of the earlier notification UBD.(PCB).No./2/12.03.000/2009-10 dated April 21, 2010 , the Reserve Bank of India hereby notifies that the average Cash Reserve Ratio (CRR) required to be maintained by every Scheduled Primary (Urban) Co-operative Bank shall be 5.50 per cent of its net demand and time liabilities, from the fortnight beginning January 28, 2012.

 ( S. Karuppasamy )

Executive Director

Reproduced for reference with acknowledgment — Source: Reserve Bank of India · RBI/2011-12/369 · issued 25 Jan 2012. The plain-English explanation above is BankPulse’s own independent summary.

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Who does what — compliance checklist

💻 IT / Systems

Update internal systems and reporting templates to the revised CRR rate.

📜 Compliance

Recalculate your CRR requirement at 5.50% of NDTL for the fortnight starting January 28, 2012.
Adjust your daily CRR maintenance to reflect the new lower average ratio.
Acknowledge receipt of this circular to your controlling office.

Grouped from the action items above — a single circular may involve more than one team.

Worked example & action-note template

Example: if you are a Compliance officer at a bank this circular applies to (All Scheduled Primary (Urban) Co-operative Banks, Treasury and ALM teams of UCBs, Compliance departments of UCBs), your first concrete step on “CRR Cut for Urban Co-op Banks: 50 bps Reduction” is: “Recalculate your CRR requirement at 5.50% of NDTL for the fortnight starting January 28, 2012.” (RBI issued this 25 Jan 2012).

Circular: RBI/2011-12/369 -- CRR Cut for Urban Co-op Banks: 50 bps Reduction
Issued: 25 Jan 2012
Action required: Recalculate your CRR requirement at 5.50% of NDTL for the fortnight starting January 28, 2012.
Action required: Adjust your daily CRR maintenance to reflect the new lower average ratio.
Action required: Acknowledge receipt of this circular to your controlling office.
Action required: Update internal systems and reporting templates to the revised CRR rate.
Owner: ____________ Target date: ____________
Board/committee approval needed? Y / N
Evidence filed in compliance register on: ____________

Built only from this circular’s own published fields — not legal advice; always confirm against the official RBI source.

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BankPulse Compliance Evidence Pack — generated 03 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=6966&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.