Current · Source: Reserve Bank of India · RBI/2025-26/240 · issued 10 Mar 2026 · ~1 min read
Quick answerRBI amends capital adequacy norms for payments banks to align with international standards and provide clarity on counterparty credit risk.
The rule, in the simplest words
Payments banks must review their capital adequacy ratios to comply with new norms.
Banks must reassess their risk management strategies to align with international standards.
The RBI has updated the risk weight for trade exposure to qualified central counterparties.
How it plays out — a real example
Rahul, a risk manager at a payments bank in Mumbai, is reviewing their capital adequacy ratios to ensure compliance with the new RBI norms. He is working closely with the lending team to assess the impact of the updated add-on factors on their off-balance sheet items and adjust their risk management strategies accordingly. This will help the bank to maintain a stable capital position and continue to provide financial services to its customers.
What changed
The Reserve Bank of India has amended the prudential norms on capital adequacy for payments banks. The amendments include changes to the add-on factors for market-related off-balance sheet items and the risk weight for trade exposure to qualified central counterparties. The updated norms aim to provide greater clarity and align with international standards.
What it means for you
The updated norms will impact payments banks' capital requirements and risk management practices. Banks will need to reassess their capital adequacy and adjust their risk management strategies to comply with the new norms. This may lead to increased capital requirements for some banks, which could affect their lending capabilities and profitability.
What you must do
Review current capital adequacy ratios
Assess impact of updated add-on factors on off-balance sheet items
Adjust risk management strategies to comply with new norms
Who it affects
Payments banks, Lenders, Risk managers
❓ Common questions
What are the key changes to the prudential norms?
The amendments include changes to add-on factors for market-related off-balance sheet items and the risk weight for trade exposure to qualified central counterparties.
When do the updated norms come into effect?
The updated norms come into effect from the date of issue, March 10, 2026.
📜 Read the original circular — full text as issued by RBI
RBI/2025-26/240
DOR.MRG.REC.No.435/21-01-002/2025-26
March 10, 2026
Reserve Bank of India (Payments Banks - Prudential Norms on Capital Adequacy) Amendment Directions, 2026
Please refer to paragraph 52 on ‘Treatment of total Counterparty Credit Risk’ of the Reserve Bank of India (Payments Banks - Prudential Norms on Capital Adequacy) Directions, 2025 . It has been decided to amend these instructions to provide greater clarity and to largely align them with international standards.
2. Accordingly, in exercise of the powers conferred by Section 35A of the Banking Regulation Act, 1949, and all other provisions / laws enabling the Reserve Bank of India (RBI) in this regard, RBI being satisfied that it is necessary and expedient in the public interest so to do, hereby, issues the Amendment Directions hereinafter specified.
3. (i) These instructions shall be called the Reserve Bank of India (Payments Banks - Prudential Norms on Capital Adequacy) Amendment Directions, 2026.
(ii) These Amendment Directions shall come into effect from the date of issue.
4. The Reserve Bank of India (Payments Banks - Prudential Norms on Capital Adequacy) Directions, 2025 , are amended as provided below.
4.1. Table 10 in paragraph 52(2) shall be substituted by the following, namely: –
“Table 10: Add-on factors for market-related off-balance sheet items
Reproduced for reference with acknowledgment — Source: Reserve Bank of India · RBI/2025-26/240 · issued 10 Mar 2026. The plain-English explanation above is BankPulse’s own independent summary.
Assess impact of updated add-on factors on off-balance sheet items
Adjust risk management strategies to comply with new norms
Grouped from the action items above — a single circular may involve more than one team.
Worked example & action-note template
Example: if you are an IT/Systems lead at a bank this circular applies to (Payments banks, Lenders, Risk managers), your first concrete step on “RBI Updates Prudential Norms” is: “Review current capital adequacy ratios” (RBI issued this 10 Mar 2026).
Action required: Review current capital adequacy ratios
Action required: Assess impact of updated add-on factors on off-balance sheet items
Action required: Adjust risk management strategies to comply with new norms
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.
💬 Banker Discussion
Discuss this circular with fellow bankers — reply, upvote what helps, report what doesn’t belong. Be professional; no client data. Views are the commenter’s own, not BankPulse’s.
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=13330&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.
Help us keep this accurate
Found an inaccuracy or have an improvement? Tell us. Every report is reviewed by our team before any change is made — nothing goes live unverified.
Public beta — plain-English informational summaries. Always verify against the official RBI source (circular number cited on every page) before making compliance, credit, treasury, audit, or operational decisions. · Join our WhatsApp channel ↗
BANKPULSE · FREE DAILY BRIEF
Get RBI updates for your role
Every important RBI update, decoded in plain English — for your career, exams & financial awareness.
We collect only your email, name and role, used solely to send your brief — never sold or shared. Withdraw anytime via the unsubscribe link in any email. Independent platform, not affiliated with the RBI. Information, not legal advice.
REPORT AN ERROR · BETA
Spotted an error? Earn 500 BankPulse Credits
Help us stay accurate. If your correction is verified true and approved by our founder, you earn 500 BankPulse Credits — redeemable when the platform monetises.
Reviewed by a human before any credit is awarded. We never change the site from crowd input without verification.
WANT A NEW FEATURE · BETA
What would make BankPulse more useful for you?
Tell us what to build next — a tool, a data view, a role page, anything. We read every suggestion.
Thank you — your ideas directly shape what we build.