The Reserve Bank of India has amended its 2025 prudential norms on capital adequacy for urban co-operative banks to give preferential capital treatment to exposures covered by the Government of India’s Emergency Credit Line Guarantee Scheme 5.0. The change allows a zero percent risk weight for a defined portion of those guaranteed exposures. Specifically, exposures guaranteed under ECLGS 5.0 will attract a zero percent risk weight to the extent of 75% of the guaranteed portion, that is, the part for which the settlement amount is expected to be received within 30 days from the date of invocation. The remaining exposure will continue to attract risk weight under the existing guidelines. The amendment takes effect immediately.
Reserve Bank of India2026-06-16
Reserve Bank of India grants zero percent risk weight for part of ECLGS 5.0 exposures under urban co-operative bank capital rules
The Reserve Bank of India has amended urban co-operative bank capital adequacy rules to give favorable treatment to ECLGS 5.0 guaranteed exposures. A zero percent risk weight applies to 75% of the guaranteed portion where settlement is expected within 30 days of invocation, while the rest remains subject to existing risk weights. The change is effective immediately.