What changed
RBI issued the Reserve Bank of India (Payments Banks – Financial Statements: Presentation and Disclosures) Directions, 2025, effective immediately from November 28, 2025. These Directions prescribe the format for balance sheet and profit and loss account as per the Third Schedule of the Banking Regulation Act, 1949, and include detailed instructions for compilation, disclosure requirements, and guidance on accounting standards. They also cover consolidated financial statements, inter-branch account provisioning, Nostro reconciliation, reserve fund transfers, fraud provisioning, unreconciled balances, deferred tax liability on special reserves, and window dressing.
What it means for you
Payments Banks must now strictly adhere to the new standardized formats and disclosure norms for their financial statements, ensuring greater transparency and comparability. The Directions mandate compliance with Accounting Standards notified under the Companies (Accounting Standards) Rules, 2021, subject to RBI guidelines, which may require changes in internal reporting systems. Banks need to review and update their financial reporting processes to align with these requirements, including specific provisions for fraud, unreconciled balances, and deferred tax liabilities.
What you must do
- Update financial statement templates to match the formats in Annex I of the Directions.
- Ensure compliance with all Accounting Standards as per Companies (Accounting Standards) Rules, 2021, and RBI guidelines.
- Review and implement new disclosure requirements in Notes to Accounts as per Chapter III.
- Adjust provisioning and reconciliation processes for inter-branch accounts, Nostro accounts, fraud, and unreconciled balances as per Chapter V.
- Train finance and compliance teams on the updated Directions and repeal of previous versions.
Who it affects
Payments Banks, Finance and accounting departments of Payments Banks, Compliance teams of Payments Banks, Auditors of Payments Banks
When do these Directions take effect?
The Directions came into force with immediate effect from November 28, 2025.
Do these Directions replace any previous guidelines?
Yes, Chapter VI provides for repeal and saving of previous versions, meaning earlier directions on this subject are superseded.
Are these Directions applicable to all Payments Banks?
Yes, the Directions are applicable to all Payments Banks as defined in the document.