What changed
RBI amended the definition of 'Bulk Deposit' under the Master Direction on Interest Rate on Deposits for co-operative banks. For Scheduled Primary UCBs in Tier 3 and 4, the threshold is now ₹1 crore and above. For all other UCBs, the threshold stays at ₹15 lakh and above.
What it means for you
Larger UCBs (Tier 3 and 4) can now accept term deposits up to ₹1 crore without classifying them as bulk deposits, giving them more flexibility in pricing and reporting. This aligns the definition with their higher deposit base and reduces compliance burden. Other UCBs must continue treating deposits of ₹15 lakh and above as bulk deposits.
What you must do
- Update your bank's internal deposit policy and systems to reflect the new bulk deposit thresholds.
- Reclassify existing deposits for Tier 3 and 4 UCBs if they fall between ₹15 lakh and ₹1 crore.
- Train branch staff on the revised definition to ensure correct reporting and interest rate application.
- Review and amend any customer-facing documents or rate sheets that reference the old bulk deposit limit.
Who it affects
Scheduled Primary Urban Co-operative Banks in Tier 3 and 4, All other Urban Co-operative Banks (non-scheduled or lower tiers), Deposit operations and compliance teams at UCBs, RBI's supervisory and reporting framework for co-operative banks
What is the new bulk deposit limit for Scheduled Tier 3 and 4 UCBs?
The limit has been raised from ₹15 lakh to ₹1 crore. Any single rupee term deposit of ₹1 crore or more will now be considered a bulk deposit for these banks.
Does this change apply to all urban co-operative banks?
No. It applies only to Scheduled Primary UCBs categorised as Tier 3 and 4 under the revised regulatory framework. All other UCBs continue with the ₹15 lakh threshold.
When did this revision take effect?
The circular was issued on January 1, 2024, and is effective from that date. Banks should implement the changes immediately.