What changed
RBI issued the Reserve Bank of India (Payments Banks – Asset Liability Management) Directions, 2025, effective from the date of issue, November 28, 2025. These directions set out ALM requirements for Payments Banks, covering liquidity risk, interest rate risk, board oversight, and reporting. Chapter VI repeals previous instructions on the subject.
What it means for you
Payments Banks must now comply with a dedicated ALM framework, including board-approved policies for liquidity and interest rate risk. This enhances risk governance and aligns Payments Banks with broader banking norms. Banks need to update their internal processes, MIS, and reporting systems to meet the new requirements.
What you must do
- Review and update your ALM policy to align with the new Directions, covering liquidity risk management, interest rate risk, and board responsibilities.
- Ensure board approval of all ALM policies, limits, and review mechanisms as specified in Chapter II.
- Implement systems for liquidity risk measurement (flow and stock approaches), stress testing, and contingency funding plans as per Chapter III.
- Set up interest rate risk management frameworks covering earnings and economic value perspectives as per Chapter IV.
- Prepare and submit regulatory returns on liquidity and interest rate risk as per the periodicity and formats in Chapter V and Annexures.
Who it affects
Payments Banks in India, Board of Directors of Payments Banks, Risk management teams of Payments Banks, Compliance and reporting departments of Payments Banks
When do these Directions come into effect?
The Directions come into effect from the date of issue, November 28, 2025.
What is the scope of these Directions?
They apply to all Payments Banks and cover asset liability management, including liquidity risk, interest rate risk, board responsibilities, and regulatory reporting.
Do these Directions replace existing ALM guidelines for Payments Banks?
Yes, Chapter VI repeals and saves previous instructions, meaning these Directions supersede earlier ALM guidelines for Payments Banks.