What changed
RBI issued a new master circular on branch authorisation under Section 23 of the Banking Regulation Act, 1949, updating the previous July 2012 circular. It incorporates all instructions issued up to June 30, 2013, into one consolidated document. The circular is now available on the RBI website.
What it means for you
Banks must refer to this updated master circular for all branch-related approvals and reporting. The consolidation simplifies compliance by providing a single reference for rules on branch expansion, shifting, and closure. Foreign banks have specific guidance in paragraph 24, which may differ from domestic bank rules.
What you must do
- Review the full master circular on RBI's website to understand updated procedures for branch authorisation.
- Ensure all branch expansion plans align with the new guidelines, especially for underbanked districts.
- Foreign banks must strictly follow paragraph 24 of this circular for compliance.
- Update internal policies and training materials to reflect the consolidated instructions.
Who it affects
All commercial banks excluding Regional Rural Banks, Foreign banks operating in India, Bank branch expansion and compliance teams
Does this circular change the branch opening process?
It consolidates existing instructions up to June 30, 2013, so no new policy changes are introduced. However, banks should use this as the single reference for all branch authorisation procedures.
Are foreign banks treated differently under this circular?
Yes, foreign banks are specifically guided by paragraph 24 of the master circular, which may have separate provisions from those for domestic banks.
Where can I find the full list of underbanked districts?
The circular includes Annex-5 and Annex-6 listing underbanked districts and underbanked states, which are critical for branch expansion planning.