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UCBs get CRR/SLR relief on 3-year+ NRE term deposits mobilized till Sep 2026

Current · Source: Reserve Bank of India · RBI/2026-27/147 · issued 19 Jun 2026 · ~2 min read
Quick answerRBI exempts fresh NRE term deposits of 3 years or more (including renewals) from CRR and SLR for urban co-operative banks, for deposits mobilized between June 19, 2026 and September 30, 2026. The exemption applies to original deposit amounts as long as they remain in bank books. CRR exemption effective from reporting fortnight beginning July 16, 2026.
The rule, in the simplest words
How it plays out — a real example

A forex & trade-finance officer in Indore, Priya, tells an NRI customer that if he opens a new 3-year NRE fixed deposit before September 30, 2026, the bank won't need to set aside any reserves for it. This means the bank can offer a slightly higher interest rate, and Priya can explain that the deposit is more profitable for the bank, making it a win-win for both.

What changed

RBI has amended the Urban Co-operative Banks (CRR and SLR) Directions, 2025 to insert a new sub-paragraph in paragraph 21. Fresh NRE term deposits with a tenor of three years or more, mobilized between June 19, 2026 and September 30, 2026, are now exempt from CRR and SLR maintenance. The CRR exemption starts from the reporting fortnight beginning July 16, 2026, based on NDTL as on June 30, 2026.

What it means for you

UCBs can now attract longer-tenor NRE deposits without the cost of maintaining reserves, improving their net interest margins and liquidity. This is a targeted incentive to boost stable, long-term foreign currency inflows. Banks should note that transfers from NRO to NRE accounts do not qualify for this exemption.

What you must do

Who it affects

Urban Co-operative Banks (UCBs), NRE deposit holders (NRIs), Treasury and compliance departments of UCBs

❓ Common questions

Does the exemption apply to renewals of existing NRE deposits?

Yes, renewals upon maturity of NRE term deposits of three years or more are also exempt, provided they occur between June 19, 2026 and September 30, 2026.

Are NRO to NRE account transfers eligible for this exemption?

No, the RBI has explicitly stated that transfers from Non-Resident (Ordinary) accounts to NRE accounts will not qualify for the CRR/SLR exemption.

When does the CRR exemption become effective for reporting?

The exemption applies from the reporting fortnight beginning July 16, 2026, based on the NDTL computation as on June 30, 2026.

📜 Read the original circular — full text as issued by RBI
RBI/2026-27/147 DOR.RET.REC.126/12.01.001/2026-27 June 19, 2026 Reserve Bank of India (Urban Co-operative Banks – Cash Reserve Ratio and Statutory Liquidity Ratio) Third Amendment Directions, 2026 Please refer to the Reserve Bank of India (Urban Co-operative 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, read with section 56 (AACS), 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 (Urban Co-operative 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 (Urban Co-operative Banks – Cash Reserve Ratio and Statutory Liquidity Ratio) Directions, 2025 as under: i. In paragraph 21, the following sub-paragraph shall be inserted “6. 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(4), the words ‘paragraphs 21 (3), (4) and (5)’ shall be substituted with ‘paragraphs 21 (3), (4), (5) and (6)’. Yours faithfully, (Manoranjan Padhy) Chief General Manager
Reproduced for reference with acknowledgment — Source: Reserve Bank of India · RBI/2026-27/147 · issued 19 Jun 2026. The plain-English explanation above is BankPulse’s own independent summary.
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Topics: Deposits / Interest RatesCo-operative Banks
Most relevant forCompliance TeamTreasury Team / ALMProduct Manager (Digital & Lending)NRI Relationship ManagerBranch Operations (Accounts / FD / CASA)Teller / Cashier / Customer Service Officer
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Key termsPlain-English definitions of terms in this circular — see the full Indian banking glossary. Repo rate · CASA · Statutory Liquidity Ratio (SLR) · Deposit insurance (DICGC)
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Who does what — compliance checklist
🏦 Branch Manager
  • Train branch staff to correctly identify eligible deposits and exclude NRO-to-NRE transfers from the exemption.
📜 Compliance
  • Update your deposit product offerings to highlight the CRR/SLR exemption on 3-year+ NRE term deposits.
  • Ensure your treasury and compliance teams adjust NDTL calculations from July 16, 2026 fortnight onwards.
  • Monitor the September 30, 2026 deadline to avoid inadvertent reserve maintenance post-expiry.
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 (Urban Co-operative Banks (UCBs), NRE deposit holders (NRIs), Treasury and compliance departments of UCBs), your first concrete step on “UCBs get CRR/SLR relief on 3-year+ NRE term deposits mobilized till Sep 2026” is: “Update your deposit product offerings to highlight the CRR/SLR exemption on 3-year+ NRE term deposits.” (RBI issued this 19 Jun 2026).

  1. Circular: RBI/2026-27/147 -- UCBs get CRR/SLR relief on 3-year+ NRE term deposits mobilized till Sep 2026
  2. Issued: 19 Jun 2026
  3. Action required: Update your deposit product offerings to highlight the CRR/SLR exemption on 3-year+ NRE term deposits.
  4. Action required: Ensure your treasury and compliance teams adjust NDTL calculations from July 16, 2026 fortnight onwards.
  5. Action required: Train branch staff to correctly identify eligible deposits and exclude NRO-to-NRE transfers from the exemption.
  6. Action required: Monitor the September 30, 2026 deadline to avoid inadvertent reserve maintenance post-expiry.
  7. Owner: ____________ Target date: ____________
  8. Board/committee approval needed? Y / N
  9. 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.

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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=13518&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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