SFBs get CRR/SLR relief on 3+ year NRE term deposits till September 30, 2026
Current & verified — this is the latest version
Source: Reserve Bank of India · RBI/2026-27/146 · issued 30 Sep 2026 · ~2 min read
Quick answerRBI exempts small finance banks from maintaining CRR and SLR on fresh NRE term deposits of 3 years or more, mobilized from June 19 to September 30, 2026. This relief applies to original deposit amounts as long as they remain in bank books, but excludes transfers from NRO accounts.
The rule, in the simplest words
Small finance banks (SFBs) do not have to keep money with RBI (CRR) or buy government bonds (SLR) for new NRE deposits (money from Indians living abroad) that are for 3 years or more.
This special rule works only for deposits made between June 19, 2026 and September 30, 2026.
The relief starts from the reporting period beginning July 16, 2026 and lasts as long as the deposit stays in the bank.
Money moved from NRO accounts (another type of NRI account) to NRE accounts does not get this benefit.
How it plays out — a real example
A forex & trade-finance officer in Indore, Priya, sees an NRI customer wanting to deposit ₹10 lakh for 3 years. She explains that if the customer opens a fresh NRE term deposit before September 30, 2026, the bank won't need to set aside any of that money for CRR or SLR, so Priya can offer a higher interest rate and use the full amount for lending.
What changed
RBI has amended the Small Finance Banks (CRR and SLR) Directions, 2025 to insert a new sub-paragraph (7) in paragraph 20. This exempts fresh NRE term deposits of 3 years or more tenor, mobilized between June 19, 2026 and September 30, 2026, from CRR and SLR maintenance. The exemption starts from the reporting fortnight beginning July 16, 2026 and lasts as long as the deposits stay in the bank's books. Transfers from NRO to NRE accounts do not qualify.
What it means for you
Small finance banks can now offer more competitive NRE deposit rates for longer tenors without worrying about the reserve cost, potentially boosting their NRE deposit mobilisation. This frees up funds that would otherwise be locked in CRR and SLR, improving their lendable resources and net interest margins. However, the window is limited to just over three months, so banks need to act quickly to capitalise.
What you must do
Update your NRE term deposit product sheets and marketing materials to highlight the CRR/SLR exemption for 3-year+ tenors.
Train treasury and branch staff on the eligibility criteria: only fresh NRE deposits (not NRO transfers) of 3 years or more, mobilized between June 19 and Sep 30, 2026.
Adjust your ALM and liquidity planning to account for the freed-up reserves from these exempt deposits.
Monitor the reporting fortnight start date (July 16, 2026) for CRR/SLR computation changes.
Who it affects
Small finance banks, NRE depositors (especially NRIs seeking longer-tenor deposits), Treasury and ALM teams at SFBs
Built from our lineage records — each fact carries its provenance; missing history simply is not shown (never guessed).
Does this exemption apply to renewals of existing NRE deposits?
Yes, the exemption covers deposits that are renewed upon maturity, provided the renewal happens between June 19 and September 30, 2026 and the renewed tenor is 3 years or more.
Are NRO to NRE transfers eligible for this CRR/SLR relief?
No. The notification explicitly states that any transfer from Non-Resident (Ordinary) (NRO) accounts to NRE accounts will not qualify for the exemption.
When does the CRR/SLR exemption actually take effect for these deposits?
The exemption applies from the reporting fortnight beginning July 16, 2026, which is based on the NDTL computation as on June 30, 2026. So deposits mobilized before that date will still see the benefit from that fortnight onward.
📜 Read the original circular — full text as issued by RBI
RBI/2026-27/146
DOR.RET.REC.124/12.01.001/2026-27
June 19, 2026
Reserve Bank of India (Small Finance Banks – Cash Reserve Ratio and Statutory Liquidity Ratio) Third Amendment Directions, 2026
Please refer to the Reserve Bank of India (Small Finance Banks – Cash Reserve Ratio and Statutory Liquidity Ratio) Directions, 2025 (Updated as on June 8, 2026). On review, it has been decided that fresh Non-Resident (External) Rupee (NRE) term deposits of tenor of three years or more mobilized (including deposits that are renewed upon maturity) by the banks from the date of this Amendment Directions till September 30, 2026 will be exempted from maintenance of CRR and SLR.
2. Accordingly, in exercise of the powers conferred by Section 35A of the Banking Regulation Act, 1949 and pursuant to Section 42 of the Reserve Bank of India Act, 1934 and Sections 18 and 24 of Banking Regulation Act, 1949, as amended from time to time, and all other provisions / laws enabling the Reserve Bank of India in this regard, the Reserve Bank being satisfied that it is necessary and expedient in the public interest so to do, hereby, issues the Amendment Directions hereinafter specified.
3. These Directions shall be called the Reserve Bank of India (Small Finance Banks – Cash Reserve Ratio and Statutory Liquidity Ratio) Third Amendment Directions, 2026.
4. The provisions shall come into force with immediate effect.
5. These Amendment Directions modify the Reserve Bank of India (Small Finance Banks – Cash Reserve Ratio and Statutory Liquidity Ratio) Directions, 2025 as under:
i. In paragraph 20, the following sub-paragraph shall be inserted “7. Fresh Non-Resident (External) Rupee (NRE) term deposits of tenor of three years or more mobilized (including deposits that are renewed upon maturity) by the banks between June 19, 2026 and September 30, 2026 are exempt from maintenance of CRR from the reporting fortnight beginning July 16, 2026 (i.e., based on the NDTL computation as on June 30, 2026) and subsequent fortnights thereafter. The exemption on reserves maintenance is available for the original deposit amounts till such time the deposits are held in the bank books. Any transfer from Non-Resident (Ordinary) (NRO) accounts to NRE accounts will not qualify for such exemptions”.
ii. In paragraph 29(5), the words ‘paragraphs 20 (3), (4), (5) and (6)’ shall be substituted with ‘paragraphs 20 (3), (4), (5), (6) and (7)’.
iii. In item VIII of the Annex A to Form A,
the item VIII.8 shall be renumbered as item VIII.9
the words “NRE Term deposits – 2026 [para 20(7)]” shall be inserted as item VIII.8.
Yours faithfully,
(Manoranjan Padhy)
Chief General Manager
Reproduced for reference with acknowledgment — Source: Reserve Bank of India · RBI/2026-27/146 · issued 30 Sep 2026. The plain-English explanation above is BankPulse’s own independent summary.
Train treasury and branch staff on the eligibility criteria: only fresh NRE deposits (not NRO transfers) of 3 years or more, mobilized between June 19 and Sep 30, 2026.
📜 Compliance
Update your NRE term deposit product sheets and marketing materials to highlight the CRR/SLR exemption for 3-year+ tenors.
Adjust your ALM and liquidity planning to account for the freed-up reserves from these exempt deposits.
Monitor the reporting fortnight start date (July 16, 2026) for CRR/SLR computation changes.
Grouped from the action items above — a single circular may involve more than one team.
Worked example & action-note template
Example: if you are a Compliance officer at a bank this circular applies to (Small finance banks, NRE depositors (especially NRIs seeking longer-tenor deposits), Treasury and ALM teams at SFBs), your first concrete step on “SFBs get CRR/SLR relief on 3+ year NRE term deposits till September 30, 2026” is: “Update your NRE term deposit product sheets and marketing materials to highlight the CRR/SLR exemption for 3-year+ tenors.” (RBI issued this 30 Sep 2026).
Circular: RBI/2026-27/146 -- SFBs get CRR/SLR relief on 3+ year NRE term deposits till September 30, 2026
Issued: 30 Sep 2026
Action required: Update your NRE term deposit product sheets and marketing materials to highlight the CRR/SLR exemption for 3-year+ tenors.
Action required: Train treasury and branch staff on the eligibility criteria: only fresh NRE deposits (not NRO transfers) of 3 years or more, mobilized between June 19 and Sep 30, 2026.
Action required: Adjust your ALM and liquidity planning to account for the freed-up reserves from these exempt deposits.
Action required: Monitor the reporting fortnight start date (July 16, 2026) for CRR/SLR computation changes.
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 05 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=13517&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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