Source: Reserve Bank of India · RBI/2026-27/148 · issued 19 Jun 2026 · ~2 min read
Quick answerRural co-operative banks can now raise fresh NRE term deposits of 3+ years without maintaining CRR or SLR, if mobilized between June 19, 2026 and September 30, 2026. This temporary exemption aims to boost foreign currency inflows and ease liquidity pressure on RCBs.
The rule, in the simplest words
Rural co-operative banks (small banks in villages) can get a break from keeping money in reserve (CRR/SLR) for new NRE deposits (foreign money from Indians living abroad) that last 3 years or more.
This break only works if the bank gets these deposits between June 19, 2026 and September 30, 2026.
The break starts from the reporting period beginning July 16, 2026, and lasts as long as the deposit stays in the bank.
Moving money from an NRO account (another type of foreign account) to an NRE account does not count for this break.
How it plays out — a real example
A forex & trade-finance officer in Indore tells a customer who works in Dubai that if she opens a fresh NRE fixed deposit for 3 years before September 30, 2026, the bank won't have to set aside any reserve money for it. This means the bank can use more of that deposit to give loans to local farmers, and the customer still earns interest on her full deposit.
What changed
The RBI has amended the Rural Co-operative Banks (CRR and SLR) Directions, 2025 to insert a new sub-paragraph (6) under paragraph 21. This exempts fresh NRE term deposits of three years or more, mobilized from June 19, 2026 to September 30, 2026, from CRR and SLR maintenance. The exemption applies from the reporting fortnight beginning July 16, 2026 (based on NDTL computation as on June 30, 2026), and remains valid as long as the deposit stays in the bank's books. Transfers from NRO to NRE accounts do not qualify.
What it means for you
For rural co-operative banks, this is a targeted liquidity relief that reduces the cost of raising long-term NRE deposits. By freeing up funds that would otherwise be locked in reserves, banks can deploy more resources for lending or investment. The window is short—just over three months—so banks need to act quickly to attract these deposits. The exclusion of NRO-to-NRE transfers prevents arbitrage and ensures the incentive is for genuine new inflows.
What you must do
Review your current NRE deposit product suite and ensure you can offer 3+ year tenors to capture this exemption.
Train branch staff and treasury teams on the eligibility criteria: only fresh NRE deposits (including renewals) between June 19 and Sep 30, 2026 qualify; NRO-to-NRE transfers do not.
Update your CRR/SLR computation systems to exclude these deposits from NDTL from the July 16, 2026 fortnight onward.
Communicate the benefit to existing NRE depositors and potential customers to maximize inflows before the September 30 deadline.
Who it affects
Rural Co-operative Banks (RCBs), Treasury and ALM teams at RCBs, NRE depositors (especially those with long-term investment horizons)
❓ Common questions
Does this exemption apply to renewals of existing NRE deposits?
Yes, renewals upon maturity of existing NRE deposits also qualify, provided the renewed deposit has a tenor of three years or more and the renewal occurs between June 19, 2026 and September 30, 2026.
What happens if the deposit is withdrawn before maturity?
The exemption is available for the original deposit amount as long as it remains in the bank's books. If the deposit is prematurely withdrawn, the exemption would cease, and the bank would need to maintain CRR/SLR on that amount from the relevant fortnight.
Are NRE deposits from any source eligible, or only from specific countries?
The direction does not restrict the source country. Any fresh NRE term deposit meeting the tenor and mobilization period criteria qualifies, as long as it is not a transfer from an NRO account.
📜 Read the original circular — full text as issued by RBI
RBI/2026-27/148
DOR.RET.REC.127/12.01.001/2026-27
June 19, 2026
Reserve Bank of India (Rural Co-operative Banks – Cash Reserve Ratio and Statutory Liquidity Ratio) Third Amendment Directions, 2026
Please refer to the Reserve Bank of India (Rural 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 (Rural 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 (Rural 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/2026-27/148 · issued 19 Jun 2026. The plain-English explanation above is BankPulse’s own independent summary.
Train branch staff and treasury teams on the eligibility criteria: only fresh NRE deposits (including renewals) between June 19 and Sep 30, 2026 qualify; NRO-to-NRE transfers do not.
💻 IT / Systems
Update your CRR/SLR computation systems to exclude these deposits from NDTL from the July 16, 2026 fortnight onward.
📜 Compliance
Review your current NRE deposit product suite and ensure you can offer 3+ year tenors to capture this exemption.
Communicate the benefit to existing NRE depositors and potential customers to maximize inflows before the September 30 deadline.
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 (Rural Co-operative Banks (RCBs), Treasury and ALM teams at RCBs, NRE depositors (especially those with long-term investment horizons)), your first concrete step on “RCBs get CRR/SLR relief on long-term NRE deposits” is: “Review your current NRE deposit product suite and ensure you can offer 3+ year tenors to capture this exemption.” (RBI issued this 19 Jun 2026).
Circular: RBI/2026-27/148 -- RCBs get CRR/SLR relief on long-term NRE deposits
Issued: 19 Jun 2026
Action required: Review your current NRE deposit product suite and ensure you can offer 3+ year tenors to capture this exemption.
Action required: Train branch staff and treasury teams on the eligibility criteria: only fresh NRE deposits (including renewals) between June 19 and Sep 30, 2026 qualify; NRO-to-NRE transfers do not.
Action required: Update your CRR/SLR computation systems to exclude these deposits from NDTL from the July 16, 2026 fortnight onward.
Action required: Communicate the benefit to existing NRE depositors and potential customers to maximize inflows before the September 30 deadline.
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=13519&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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