What changed
The previous Master Circular dated January 16, 2024 has been replaced with a revised version that incorporates all instructions issued up to March 31, 2025. The circular explicitly states it contains no new guidelines—only consolidation of existing ones.
What it means for you
UCBs must now refer to this updated Master Circular for all exposure ceilings, unsecured advance limits, and statutory restrictions. Since no new rules are added, compliance requirements remain unchanged, but the consolidated document reduces the risk of missing any earlier circular. Banks should update their internal policy manuals and training materials to reference this version.
What you must do
- Replace the old January 2024 Master Circular with this April 2025 version in your compliance library.
- Verify that your current exposure limits for individual/group borrowers, real estate, and inter-bank exposures align with the consolidated norms.
- Ensure all loan officers and credit teams are aware that this circular is a compilation only, with no new instructions.
- Review the Annex for the list of circulars consolidated to confirm no prior instruction has been overlooked.
Who it affects
Primary (Urban) Co-operative Banks, Compliance and risk management teams at UCBs, Credit officers handling exposure limits and unsecured advances
Does this Master Circular introduce any new exposure limits for UCBs?
No. The circular explicitly states it only consolidates all instructions issued up to March 31, 2025 and does not contain any new guidelines.
What is the effective date of this updated Master Circular?
The circular is dated April 1, 2025 and supersedes the previous Master Circular of January 16, 2024.
How should UCBs compute exposure limits under this circular?
Tier-I capital as on March 31 of the preceding financial year is used for fixing exposure limits. Credit exposure includes both funded and non-funded limits, with the higher of sanctioned limit or outstanding to be reckoned.