Reserve Bank of India (Rural Co-operative Banks – Responsible Business Conduct) Directions, 2025 (Updated as on July 1, 2026)
UR
- Applies toRural co-operative banks
- StatusIn force
- RBI text changedRBI's text for this document has changed since BankPulse last read it. BankPulse is re-reading it.
- IssuedNov 28, 2025
- Last amendedAug 06, 2026 · 5 incorporated
- Length99 points in 5 sections · 9 min read
The four dates on this rule
- PublishedNov 28, 2025The day RBI put this document out. This is the same day as the Issued date on this rule.
- Starts to applyNov 28, 2025The day this rule starts to apply, as RBI's own text states it.
- Time to get readyNoneIt starts to apply on the day it was published.
- Last date to actNot statedNo date to act by was found in this document. Other dates may sit inside single paragraphs.
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88 of the 99 points name no product and bind every product. All products.
Numbers to remember
| four hours | A branch must serve the public at least four hours on weekdays and two on Saturdays. RBI Para 24 |
| seven working days | If a customer reports later than seven working days, the bank's own policy decides liability. RBI Para 63 |
| 30 days | Changes in service charges over the past 30 days must be on display. RBI Para 76(2) |
| three working days | A request to reactivate a dormant account must be settled within three working days. RBI Para 187 |
| ₹5,000 | Where the delay is the lender's fault, the borrower gets ₹5,000 for each day of delay. RBI Para 318 |
| 85 per cent | If an auction fails twice, the floor price must be at least 85 per cent of value. RBI Para 343 |
| two years | Pledged gold or silver left more than two years after repayment is treated as unclaimed. RBI Para 351 |
What it says
How firm is each point
Stated by RBI — RBI’s own paragraph says this. We have only made it plainer.
Our reading — BankPulse read RBI’s paragraph and shortened it. The paragraph is the authority, not this line.
Needs judgement — RBI leaves this to the bank to settle, so nobody can give you a fixed number here.
Can be read two ways
A point marked this way sits on an RBI paragraph that can honestly be read two ways. Our own sentence takes one of the two. BankPulse does not choose for you: read RBI’s own paragraph, at the number printed on the point, before you act on it.
Two ways — firm, or the usual course. RBI’s paragraph softens the duty with a hedging word instead of stating it flat. One reading: It is a firm rule, and only a rare case RBI would accept sits outside it. The other: It is the usual course, and a bank may depart from it for its own recorded reasons.
Chapter I. Preliminary
1. Fair conduct for RCBs
This document sets how rural co-operative banks must treat their customers.
2. Conduct rules for rural banks
This document sets the customer service and conduct rules.
3. Who is covered
These Directions apply to every rural co-operative bank.
Chapter II. Institutional Framework
1. Board owns customer service
Customer service must be discussed by the Board so the rules are truly followed.
2. Service ranks with profit
Customer service must rank alongside profit and growth as a stated goal.
3. Board approves deposit policy
The Board must approve a policy covering deposit accounts and the charges on them.
4. Fix service gaps quickly
Where service quality or skill gaps appear, action must be taken at once.
5. Senior citizens included
Senior citizens must be represented on the customer service committee.
Chapter III. Customer Service in Branches
1. Four hours on weekdays
A branch must serve the public at least four hours on weekdays and two on Saturdays.
2. Account moves at once
An instruction to move an account to another branch must be acted on immediately.
3. Sealed cover on transfer
If the customer asks, the transfer papers must be handed over in a sealed cover.
4. Customers may switch
A customer unhappy with the service must be free to move to another bank.
Chapter IV. Customer Guidance and Protection
Must know
1. Seven days changes the rule
If a customer reports later than seven working days, the bank's own policy decides liability.
2. Thirty days of changes shown
Changes in service charges over the past 30 days must be on display.
Do it
3. Notice board kept current
The notice board must be updated from time to time.
4. Board in local languages
The notice board must be in two languages in Hindi speaking states and three elsewhere.
5. Information easy to find
The information must be easy to reach from the home page of the website.
6. Rates shown on the website
Interest rates and service charges must be shown on the website in the set format.
7. Message alerts compulsory
Customers must be registered for message alerts on electronic transactions.
8. Alerts must be sent
Message alerts must be sent. Email alerts may be sent where the customer registered.
9. Money back with old date
The refund must be dated back to the day of the unauthorised transaction.
10. Auditors review claims
Internal auditors must review every such transaction.
11. Board approves service charges
Service charges must be worked out with prior approval of the Board.
12. Charges must be reasonable
Service charges must be reasonable and near the average cost of the service.
13. Cap on value-based charges
A charge based on value may only cover extra cost, and it must have a ceiling.
14. Charges told upfront
Full information on charges for basic services must be given upfront and in time.
15. Warning before a rise
Customers must be told in advance before service charges change.
Background
16. No mobile, no online use
A customer who gives no mobile number gets no electronic transactions beyond ATM cash.
17. Loss after reporting
Any loss after the customer reports the fraud is borne by the bank.
18. Charges only with reason
For a basic service to a person, a charge may be levied only if it is just and reasoned.
Chapter V. Financial Inclusion and Accessibility
1. Court order to follow
The lender must take steps to comply with the Supreme Court order of 30 April 2025.
2. Basic account is free
A basic savings account carries the listed facilities free, with no minimum balance.
3. Cheque book of 25 leaves
A basic savings account gets a cheque book of at least 25 leaves a year.
4. No charge for new passbook
Issuing a continuation passbook when the old one is full carries no charge.
5. Four free withdrawals
A basic savings account gets at least four free withdrawals in a month.
Chapter VI. Payment and Remittance Services
Must know
1. Small notes accepted
Counter staff cannot refuse small denomination notes when issuing a draft.
2. Counter over drop-box
A customer cannot be forced to use the cheque drop box instead of the counter.
Do it
3. National calendar accepted
A cheque dated by the National Saka calendar must be accepted if otherwise in order.
4. Notice on the drop-box
The drop box must carry a notice that cheques may also be given at the counter.
5. Policy for repeat dishonour
The Board must approve a policy for cheques that are dishonoured again and again.
Background
6. Cheques in any language
Cheque forms are printed in Hindi and English.
Chapter VII. Deposit Accounts and other Liabilities
Must know
1. Passbook free of cost
The cost of a passbook or a statement cannot be charged to the customer.
2. Minor accounts stay in credit
An account of a minor must never be allowed to go into overdraft.
3. Three days to reactivate
A request to reactivate a dormant account must be settled within three working days.
4. No unfair locker terms
Unfair terms cannot be put into a locker agreement.
Do it
5. Branch address in passbook
The branch address and telephone number must be printed in the passbook.
6. Entries must be readable
Passbook entries must be brief and understandable, not coded.
7. Deposit cover shown
The passbook must carry the deposit insurance cover and its limit.
8. Term deposits transferable
A term deposit must be freely transferable between offices of the same bank.
9. Warn minors before eighteen
A minor account holder must be told in advance what is needed on turning eighteen.
10. Board approves locker policy
The Board must approve a policy for the safe deposit locker service.
11. Nothing illegal in lockers
The locker agreement must bar keeping anything illegal or dangerous inside.
12. Waiting list for lockers
If no locker is free, the application must be acknowledged and given a waiting number.
13. Board approves locker agreement
The locker agreement itself must be approved by the Board.
Chapter VIII. Responsible Lending Conduct
Must know
1. Fees must not discriminate
Those charges and fees must be the same for everyone.
2. Charge base on early closure
Closing an overdraft early: the pre-payment charge is worked out on an amount not above the sanctioned limit.
3. Disclosed or not charged
A prepayment charge that was not disclosed as required cannot be charged at all.
4. No reviving waived fees
Fees waived earlier cannot be brought back when the loan is repaid early.
5. ₹5,000 a day for delay
Where the delay is the lender's fault, the borrower gets ₹5,000 for each day of delay.
BankPulse example. Suppose the lender is 12 days late through its own fault. The borrower is owed ₹5,000 for each of those days. That comes to ₹60,000.
6. Floor price after two failures
If an auction fails twice, the floor price must be at least 85 per cent of value.
7. Lender cannot bid
The lender and its related parties cannot bid in its own auction.
8. Two years makes it unclaimed
Pledged gold or silver left more than two years after repayment is treated as unclaimed.
9. No tall gold loan claims
Misleading advertisements with unrealistic claims about gold loans are barred.
Do it
10. Key Facts in plain language
That statement must be written in a language the borrower understands.
11. Explained and acknowledged
The statement must be explained to the borrower, who signs to say it was understood.
12. Full cost and schedule
The statement must carry the annual percentage rate and the repayment schedule.
13. Receipts for charges
Where the lender collects such charges, a receipt must reach the borrower in good time.
14. Summary box in the agreement
The statement must also appear as a summary box inside the loan agreement.
15. Statements must be simple
The statements sent to a borrower must be simple and easy to understand.
16. Papers back on time
The sanction letter must state when and where the property papers will be returned.
17. Borrower watches the testing
The borrower must be present when the gold or silver is tested at sanction.
18. Surprise checks required
Internal audit must make surprise checks of the pledged metal and keep a record.
19. Auction in the same district
The first auction must be held in the district of the lending branch.
20. Full auction account
After the auction the borrower must be told the price fetched and the dues settled.
21. One standard agreement
Microfinance loans must use a standard agreement in the borrower's language.
22. Loan card in plain words
Every entry in the loan card must be in a language the borrower understands.
23. Board policy on staff conduct
The Board must approve a policy on staff conduct, hiring, training and monitoring.
24. Training covers behaviour
Staff training must include how to behave properly with customers.
25. Conduct affects pay
How staff treat customers must count in how they are paid.
26. Free training for borrowers
Any training offered to borrowers must be free of cost.
27. Separate recovery complaints
There must be a separate route for complaints about recovery.
28. Told at disbursal
The borrower must be told about that route when the loan money is paid out.
29. Police check on agents
Agent staff must be checked, and that check includes police verification.
30. Borrower told who calls
The borrower must be given the recovery agent's details before recovery starts.
Background
31. Key Facts for term loans
A Key Facts Statement is required for every retail and small business term loan.
32. Bound by the stated terms
The lender is bound by the terms in that statement if the borrower agrees in time.
33. Lender's own call is free
No charge applies where the lender itself asks for the loan to be repaid early.
34. Other rights stay
That payment does not take away any other compensation the law allows.
35. Gold stays in the branch
Gold and silver may be handled only in branches and only by the lender's own staff.
36. Vaults, not cupboards
The metal may be stored only in branches with a vault fit for the purpose.
37. Other products need consent
Any non-credit product needs full consent, with its fees written in the loan card.
38. Microfinance prepayment free
No prepayment charge may be taken on a microfinance loan.
39. Late charge on overdue only
A delayed payment charge applies to the overdue amount, not the whole loan.
40. No harsh recovery
Neither the lender nor its agent may use harsh methods to recover dues.
41. Checks before hiring agents
A due diligence process is required before engaging any recovery agent.
Chapter X. Repeal and Other Provisions
1. Older rules repealed
This document repeals RBI's earlier instructions on responsible business conduct for rural co-operative banks.
2. Old actions preserved
Anything already done under the old rules stays governed by those old rules.
3. Approvals carried over
Approvals given under the cancelled rules are now treated as given under these rules.
4. Other laws still apply
These Directions add to other laws. They do not replace any of them.
How this rule has changed
The points above are the rule as it stands today, after every change listed here.
Issued on Nov 28, 2025. This is the date RBI put the rule out.
Changed on Dec 04, 2025. Takes effect From April 1, 2026. Exceptions and conditions are stated in the amendment..
- Early adoption. Each rural co-operative bank should put these rules in place as soon as it can.
- When rules start. These rules apply from April 1, 2026 or earlier if a bank adopts them.
- Digital payment meaning. Digital payment transaction has the same meaning as electronic funds transfer in the Payment and Settlement Systems Act, 2007.
- Offer BSBD account. Every rural co-operative bank must offer a basic savings bank deposit account as a normal service to all customers.
Changed on Apr 29, 2026.
- Temporary beyond 30 days. If the temporary branch runs beyond 30 days, the bank must get approval from the RBI regional office.
- Extra service points. The bank must also give banking services in affected areas through satellite offices, extension counters or mobile banking facilities.
- ATM restoration. The bank must quickly bring back automated teller machine (ATM) services in calamity hit areas as soon as possible.
- Alternate cash access. Till automated teller machines (ATMs) restart, the bank must give other ways for people to get needed cash.
Changed on Jun 15, 2026.
- directions start date. These amended directions apply from January 1, 2027.
- compulsory bundling meaning. Compulsory bundling is forcing a customer to take another product to get the wanted product or service.
Changed on Jun 24, 2026.
- Start date. These rules cover electronic banking transactions done on or after January 1, 2027.
- Define EBT term. Treat an electronic banking transaction the same as electronic funds transfer under the Payment and Settlement Systems Act.
- Unauthorised EBT meaning. An unauthorised electronic banking transaction is one not approved by the customer, including those from bank negligence or third-party breach.
Changed on Aug 06, 2026.
- Start date. These rules apply from January 1, 2027.
- BC as recovery agency. A business correspondent doing recovery work will be treated as a recovery agency.
- Who is recovery agent. A recovery agent is a recovery agency's representative who deals with customers for recovery work.
- Directly hired individual. If an individual is directly hired for recovery work, rules for both agency and agent apply to that person.
The same subject for other kinds of institution
The same subject for other kinds of institution.
RBI customer service and fair conduct rules for all India financial institutions
RBI customer service and fair conduct rules for commercial banks
RBI customer service and fair conduct rules for local area banks
RBI customer service and fair conduct rules for payments banks
RBI customer service and fair conduct rules for regional rural banks
RBI customer service and fair conduct rules for small finance banks
RBI customer service and fair conduct rules for urban co-operative banks
Other RBI rules for rural co-operative banks
RBI Kisan Credit Card rules for rural co-operative banks 2026
RBI capital adequacy rules for rural co-operative banks 2025
RBI credit bureau reporting rules for rural co-operative banks 2025
RBI deposit interest rate rules for rural co-operative banks 2025
RBI digital banking channel rules for rural co-operative banks 2025
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