Bank Rate Cut by 75 bps to 9.50% for RRBs and Co-op Banks
No longer current — withdrawn, no replacement on file yet
Source: Reserve Bank of India · RBI/2013-14/287 · issued 20 Sep 2013 · ~1 min read
Quick answerRBI reduced the Bank Rate from 10.25% to 9.50% effective September 20, 2013. This 75 bps cut directly lowers penal interest rates on reserve shortfalls for RRBs and cooperative banks, easing their liquidity cost burden.
What changed
The Bank Rate was reduced by 75 basis points from 10.25% to 9.50%, effective September 20, 2013. Consequently, penal interest rates on shortfalls in reserve requirements—linked to the Bank Rate—were revised downward: the existing rates of Bank Rate plus 3.0 percentage points (13.25%) and Bank Rate plus 5.0 percentage points (15.25%) became 12.50% and 14.50%, respectively.
What it means for you
For RRBs and cooperative banks, this reduction lowers the cost of penalties for failing to meet reserve requirements, improving their liquidity management flexibility. The move signals a softer monetary stance, potentially reducing funding costs for these lenders and supporting rural credit flow.
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
Update internal systems to reflect the new Bank Rate of 9.50% and revised penal interest rates (12.50% and 14.50%) for reserve shortfalls.
Communicate the rate change to treasury and compliance teams to ensure accurate calculation of penalties.
Review liquidity buffers to minimize shortfalls and take advantage of the lower penalty rates.
Acknowledge receipt of this circular to your respective RBI Regional Office.
Who it affects
All Regional Rural Banks (RRBs), State and Central Co-operative Banks
❓ Common questions
Regulatory timeline
Stated effective dateeffective September 20, 2013
Decoded by BankPulse2026-06-18 12:34 IST
repealed_by — Consolidation of Regulations — Withdrawal of circulars (28 Nov 2025)
Status change: withdrawn03 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 Bank Rate effective from September 20, 2013?
The Bank Rate has been reduced by 75 basis points from 10.25% to 9.50%, effective September 20, 2013.
How do the revised penal interest rates work?
Penal rates on reserve shortfalls are now Bank Rate plus 3.0 percentage points (12.50%) or Bank Rate plus 5.0 percentage points (14.50%), depending on the duration of the shortfall.
Which institutions are covered by this circular?
This circular applies to all Regional Rural Banks (RRBs) and State and Central Co-operative Banks.
📜 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)
Reproduced for reference with acknowledgment — Source: Reserve Bank of India · RBI/2013-14/287 · issued 20 Sep 2013. The plain-English explanation above is BankPulse’s own independent summary.
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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=8451&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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