Home › Circulars › RBI/2026-27/61

RRB NPA Classification & Provisioning Norms Updated

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Current · Source: Reserve Bank of India · RBI/2026-27/61 · issued 29 Apr 2026 · ~2 min read
Quick answerRBI amends RRB income recognition and provisioning rules, aligning them with new stressed asset resolution directions. Key changes: deletion of old paragraph 29, new paragraphs 36A-36B on asset classification post-resolution, and additional 5% provisioning for resolution plans under Chapter IV-A.
The rule, in the simplest words
How it plays out — a real example

A credit & lending officer in Indore, Mr. Kumar, needs to implement the new asset classification rules for a borrower who slipped into NPA due to a calamity. He upgrades the account to 'Standard' after implementing a compliant resolution plan, following the new paragraph 36A. He also makes an additional 5% specific provision on the outstanding debt, as per paragraph 60A.

What changed

Paragraph 29 of the existing Directions is deleted. New paragraphs 36A and 36B are inserted: 36A allows standard accounts to stay standard after a compliant resolution plan, and upgrades NPAs that slipped due to calamity to standard upon plan implementation; 36B keeps accounts restructured under paragraphs 32J-32R as standard even if subsequent restructuring is needed under Chapter IV-A. New provisioning norms (60A-60D) require an additional 5% specific provision on outstanding debt for resolution plans under Chapter IV-A, with additional 5% for each repeated restructuring, and write-back conditions after 20% repayment or one year for non-fund/cash credit facilities. New income recognition rules (68A-68B) specify accrual basis for resolution plan accounts and cash basis for accounts under paragraph 36B.

What it means for you

RRBs must now follow stricter provisioning for resolution plans under the new stressed asset framework, increasing capital requirements. The asset classification relaxations for calamity-affected and repeatedly restructured accounts provide some relief but come with higher provisioning costs. Banks need to update their internal systems and policies to align with these amended directions.

What you must do

Who it affects

Regional Rural Banks (RRBs), RRB credit and risk management teams, RRB compliance and audit departments

❓ Common questions

What happens to accounts that slipped into NPA due to a calamity before a resolution plan is implemented?

Under new paragraph 36A, such accounts shall be upgraded to 'Standard' upon implementation of a resolution plan that complies with Chapter IV-A of the RRB Stressed Assets Directions, 2025.

What is the additional provisioning requirement for resolution plans under Chapter IV-A?

Banks must make an additional specific provision of 5% of the outstanding debt for each resolution plan implemented under Chapter IV-A, over and above existing prudential provisions, subject to a ceiling of 100%.

When can the additional specific provisions be written back?

Provisions can be written back if the borrower pays at least 20% of the outstanding debt without slipping into NPA post-restructuring and without another restructuring. For non-fund or cash credit facilities, reversal is allowed after one year if no default occurred.

📜 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 ( 459 kb ) Reserve Bank of India (Regional Rural Banks – Income Recognition, Asset Classification and Provisioning) Amendment Directions, 2026 RBI/2026-27/61 DOR.STR.REC.50/21-04-048/2026-27 April 29, 2026 Reserve Bank of India (Regional Rural Banks – Income Recognition, Asset Classification and Provisioning) Amendment Directions, 2026 Please refer to Reserve Bank of India (Regional Rural Banks – Resolution of Stressed Assets) Amendment Directions, 2026 dated April 29, 2026 . 2. Consequent to the aforesaid Amendment Directions, 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 of India (hereinafter called 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 modify the Directions as under: i. Paragraph 29 shall be deleted. ii. Paragraph 36A and 36B shall be inserted as under: 36A. If a resolution plan is implemented in adherence to the provisions of Chapter IV-A of Reserve Bank of India (Regional Rural Banks – Resolution of Stressed Assets) Directions, 2025 dated November 28, 2025 , borrower accounts which are classified as 'Standard' may be retained as such upon implementation. Borrower accounts which may have slipped into NPA between the date of occurrence of the calamity and implementation of the resolution plan, shall be upgraded as 'Standard', upon implementation of the resolution plan. Provided that after implementation of the resolution plan, the subsequent asset classification shall be governed by the criteria laid out in these Directions. 36B. Accounts which are restructured under paragraph 32J to 32R of the Reserve Bank of India (Regional Rural Banks – Resolution of Stressed Assets) Directions, 2025 dated November 28, 2025 , where a subsequent restructuring is necessitated under the provisions of Chapter IV-A of the aforesaid Directions, shall continue to be classified as 'Standard'. iii. The following shall be inserted in Chapter IV - Provisioning Norms B. Additional specific provisioning in case of resolution plan implemented under Chapter IV-A of the Reserve Bank of India (Regional Rural Banks – Resolution of Stressed Assets) Directions, 2025 60A. A bank shall make an additional specific provision of five percent of the outstanding debt in respect of borrowers, for whom a resolution plan has been implemented in terms of Chapter IV-A of the Reserve Bank of India (Regional Rural Banks – Resolution of Stressed Assets) Directions, 2025 . The additional specific provisions shall be over and above the applicable prudential provisions subject to a ceiling of hundred per cent. 60B. For accounts where repeated restructuring is necessitated in terms of Chapter IV-A of the Reserve Bank of India (Regional Rural Banks – Resolution of Stressed Assets) Directions, 2025 , a bank shall make additional specific provisioning of five per cent of the outstanding debt for each instance of restructuring made under the aforesaid Directions. This additional specific provisioning shall be over and above the applicable prudential provisions subject to a ceiling of hundred per cent. 60C. The additional specific provisions maintained in terms of paragraph 60A and 60B above may be written back upon the borrower paying at least 20% of the outstanding debt with the bank, without slipping into NPA post implementation of the restructuring, and without being subjected to another restructuring. 60D. If the outstanding debt post-restructuring is only in the form of non-fund-based facilities or facilities in the nature of cash credit / overdraft, the additional specific provisions made in terms of paragraph 60A and 60B above can be reversed after one year, post implementation of the restructuring, provided the borrower was not in default at any point of time during the period concerned. In case the borrower defaults during the above period, the conditions for reversal of additional specific provision, mentioned above, shall be tested from the date of rectification of default. iv. The following shall be inserted in part A, Chapter V – Income Recognition: 68A. Interest income recognition in respect of borrower accounts where resolution plan has been implemented in terms of Chapter IV-A of the Reserve Bank of India (Regional Rural Banks – Resolution of Stressed Assets) Directions, 2025 dated November 28, 2025 , shall be on accrual basis. 68B. For accounts specified at paragraph 36B of these Directions, interest income shall be recognized on cash basis. 4. The above amendment shall come into force with effect from July 1, 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/2026-27/61 · issued 29 Apr 2026. The plain-English explanation above is BankPulse’s own independent summary.
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Who does what — compliance checklist
💰 Credit
  • Implement additional 5% specific provisioning for all resolution plans under Chapter IV-A of the RRB Stressed Assets Directions, 2025.
  • Set up tracking mechanisms for write-back conditions: 20% debt repayment without NPA slippage or one-year default-free period for non-fund/cash credit facilities.
  • Train credit and risk teams on the new asset classification rules for calamity-affected and repeatedly restructured accounts.
📜 Compliance
  • Delete paragraph 29 from your existing IRAC policy and insert new paragraphs 36A and 36B as specified.
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 (Regional Rural Banks (RRBs), RRB credit and risk management teams, RRB compliance and audit departments), your first concrete step on “RRB NPA Classification & Provisioning Norms Updated” is: “Delete paragraph 29 from your existing IRAC policy and insert new paragraphs 36A and 36B as specified.” (RBI issued this 29 Apr 2026).

  1. Circular: RBI/2026-27/61 -- RRB NPA Classification & Provisioning Norms Updated
  2. Issued: 29 Apr 2026
  3. Action required: Delete paragraph 29 from your existing IRAC policy and insert new paragraphs 36A and 36B as specified.
  4. Action required: Implement additional 5% specific provisioning for all resolution plans under Chapter IV-A of the RRB Stressed Assets Directions, 2025.
  5. Action required: Set up tracking mechanisms for write-back conditions: 20% debt repayment without NPA slippage or one-year default-free period for non-fund/cash credit facilities.
  6. Action required: Train credit and risk teams on the new asset classification rules for calamity-affected and repeatedly restructured accounts.
  7. Owner: ____________ Target date: ____________
  8. Board/committee approval needed? Y / N
  9. Evidence filed in compliance register on: ____________
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Official RBI source: https://www.rbi.org.in/Scripts/NotificationUser.aspx?Id=13430&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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