Home › Circulars › RBI/2026-27/201

RRB Income Recognition on Specified Non-Financial Assets

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Source: Reserve Bank of India · RBI/2026-27/201 · issued FY 2026-27 · ~1 min read
Quick answerFrom Oct 1, 2026, RRBs cannot recognise accrued but unrealised interest/charges on SNFA as income upon acquisition. Any such income already booked must be reversed by Sep 30, 2027. SNFA income is now 'non-interest/other income' only when realised.
The rule, in the simplest words
How it plays out — a real example

Ravi, the CFO of a Regional Rural Bank, reviews the SNFA portfolio on Oct 1, 2026. He finds a factory building acquired in March 2026 with Rs 5 lakh accrued interest still unpaid. He ensures this interest is not booked as income and sets a reversal plan for any previously booked amount by Sep 30, 2027.

What changed

RBI inserted new paragraphs 68C and 68D in Chapter V of the RRB IRAC Directions. Previously, accrued interest on acquired assets could be recognised; now it must not be recognised upon acquisition. Any prior recognition must be reversed by Sep 30, 2027. SNFA income is classified as non-interest/other income upon realisation.

What it means for you

RRBs must stop booking income on SNFA before actual cash receipt, tightening income recognition. This aligns with prudential norms and prevents inflated profits from unrealised interest. Banks need to adjust systems and reverse any such income by the deadline.

What you must do

Who it affects

Regional Rural Banks, RRB finance and accounts departments, RRB credit and recovery teams

❓ Common questions

What is a Specified Non-Financial Asset (SNFA)?

The source does not define SNFA; refer to the main RRB Stressed Assets Directions. Generally, it refers to physical assets acquired in settlement of debt.

When does this amendment take effect?

It comes into force from October 1, 2026.

What if we have already recognised income on SNFA before Oct 1, 2026?

Any such income remaining unrealised as of Sep 30, 2026 must be reversed through the Profit and Loss account by Sep 30, 2027.

📜 Read the original circular — full text as issued by RBI
Notifications - Reserve Bank of India Skip to main content Selected Selected Change Language हिंदी Search the Website Search Home About Us ▼ About Us Organisation & Functions ▶ Organisation Structure Departments Offices Training Establishment ▶ College of Agricultural Banking Reserve Bank Staff College College of Supervisors RBI's Functions and Working Governors Deputy Governors Executive Directors Communication Policy of RBI Sources of Information ▶ Annual Publications Half-yearly Publications Quarterly Publications Monthly Publications Weekly Publications Occasional Publications SDDS NSDP Data Releases Publications available on Subscription General Information RBI History Museum ▶ The RBI Museum RBI Monetary Museum Notification ▼ Notifications Master Directions Master Circulars Amendment Directions Draft Notifications/Guidelines ▶ Draft Notifications/Guidelines Draft Directions (RE-wise) Index To RBI Circulars Standalone Circulars Circulars Withdrawn Press Releases Speeches & Media Interactions ▼ Speeches Media Interactions Memorial Lectures Podcasts Publications ▼ Biennial Annual Half-Yearly Quarterly Bi-monthly Monthly Weekly Occasional Reports Working Papers Legal Framework ▼ Act Rules Regulations Schemes Research ▼ External Research Schemes RBI Occasional Papers Working Papers RBI Bulletin History DRG Studies KLEMS State Statistics and Finances Statistics ▼ Data Releases Database on Indian Economy Public Debt Statistics Regulatory Reporting ▼ List of Returns Data Definition Validation rules/ Taxonomy List of RBI Reporting Portals FAQs of RBI Reporting Portals Home Notifications Notifications ( 418 kb ) Reserve Bank of India (Regional Rural Banks – Income Recognition, Asset Classification and Provisioning) Second Amendment Directions, 2026 RBI/2026-27/201 DOR.STR.REC.166/21-04-048/2026-27 July 16, 2026 Reserve Bank of India (Regional Rural Banks – Income Recognition, Asset Classification and Provisioning) Second Amendment Directions, 2026 Please refer to Reserve Bank of India (Regional Rural Banks – Resolution of Stressed Assets) Second Amendment Directions, 2026 dated July 16, 2026 . 2. Consequent to the aforesaid Amendment Directions, in, in exercise of the powers conferred by the sections 21 and 35A of the Banking Regulation Act, 1949 and all other laws enabling the Reserve Bank 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 Amendment Directions modifies the Directions as under: (i) The following shall be inserted in Chapter V – Income Recognition: “B. Income Recognition in case of acquisition of Specified Non-Financial Assets (SNFA) 68C. Any accrued but unrealised interest and / or charges from the extinguished exposure pertaining to periods prior to acquisition of a Specified Non-Financial Asset (SNFA), shall not be recognised as income upon acquisition of the SNFA. Where such income has been recognised in respect of any SNFA outstanding in the books of a bank as on September 30, 2026, it shall be reversed through Profit and Loss account, latest by September 30, 2027, to the extent remaining unrealised as on that date. 68D. Any income received from an SNFA shall be recognised in the income statement as ‘non-interest / other income’, in the financial year in which it is realised. Similarly, any expense incurred towards upkeep of an SNFA shall be accounted for in the income statement in the financial year in which it is incurred.” 4. The above amendment would come into force with effect from October 01, 2026. (Vaibhav Chaturvedi) Chief General Manager 2026 All Months January February March April May June July August September October November December 2025 All Months January February March April May June July August September October November December 2024 All Months January February March April May June July August September October November December 2023 All Months January February March April May June July August September October November December 2022 All Months January February March April May June July August September October November December 2021 All Months January February March April May June July August September October November December 2020 All Months January February March April May June July August September October November December 2019 All Months January February March April May June July August September October November December 2018 All Months January February March April May June July August September October November December 2017 All Months January February March April May June July August September October November December Archives 2016 All Months January February March April May June July August September October November December 2015 All Months January February March April May June July August September October November December 2014 All Months January February March April May June July August September October November December 2013 All Months January February March April May June July August September October November December 2012 All Months January February March April May June July August September October November December 2011 All Months January February March April May June July August September October November December 2010 All Months January February March April May June July August September October November December 2009 All Months January February March April May June July August September October November December 2008 All Months January February March April May June July August September October November December 2007 All Months January February March April May June July August September October November December 2006 All Months January February March April May June July August September October November December 2005 All Months January February March April May June July August September October November December 2004 All Months January February March April May June July August September October November December 2003 All Months January February March April May June July August September October November December 2002 All Months January February March April May June July August September October November December 2001 All Months January February March April May June July August September October November December 2000 All Months January February March April May June July August September October November December 1999 All Months January February March April May June July August September October November December 1998 All Months January February March April May June July August September October November December 1997 All Months January February March April May June July August September October November December 1996 All Months January February March April May June July August September October November December 1995 All Months January February March April May June July August September October November December 1994 All Months January February March April May June July August September October November December 1993 All Months January February March April May June July August September October November December 1992 All Months January February March April May June July August September October November December 1991 All Months January February March April May June July August September October November December Top Back to previous page More Links Bank Holidays Banking Glossary Citizen's Charter Complaints Contact Us COVID-19 Measures E-LMS Events FAQs Financial Education Forms IFSC/MICR Codes Important Websites Opportunities @ RBI RBI Clarifications RBI Kehta Hai RBI’s Vision and Values (1257 kb)--> Right to Information Act Tenders Follow RBI RSS Twitter YouTube Instagram Facebook LinkedIn © Reserve Bank of India. 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Reproduced for reference with acknowledgment — Source: Reserve Bank of India · RBI/2026-27/201 · issued FY 2026-27. The plain-English explanation above is BankPulse’s own independent summary.
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Worked example & action-note template

Example: if you are a Compliance officer at a bank this circular applies to (Regional Rural Banks, RRB finance and accounts departments, RRB credit and recovery teams), your first concrete step on “RRB Income Recognition on Specified Non-Financial Assets” is: “Identify all SNFA in books as of Sep 30, 2026, and calculate accrued but unrealised interest/charges.” (RBI issued this FY 2026-27).

  1. Circular: RBI/2026-27/201 -- RRB Income Recognition on Specified Non-Financial Assets
  2. Issued: FY 2026-27
  3. Action required: Identify all SNFA in books as of Sep 30, 2026, and calculate accrued but unrealised interest/charges.
  4. Action required: Reverse any recognised but unrealised income from SNFA through P&L by Sep 30, 2027.
  5. Action required: Update accounting policies to recognise SNFA income only as non-interest/other income upon realisation.
  6. Action required: Train staff on new income recognition rules for SNFA acquisitions effective Oct 1, 2026.
  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 16 Jul 2026 · status cross-checked against RBI’s official withdrawal register (refreshed weekly).
Official RBI source: https://www.rbi.org.in/scripts/NotificationUser.aspx?Id=13579&Mode=0 — Plain-English summary by BankPulse (bankpulse.ai), reviewed by our expert review panel. 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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