The Reserve Bank of India has issued two draft Directions that would revise concentration risk and credit facility requirements for rural co-operative banks. The proposals prescribe prudential exposure limits for single and group counterparties and unsecured advances, while raising housing loan limits. Rural co-operative banks with deposits above INR 10 billion would gain flexibility to determine housing loan tenors and moratorium requirements. The ceilings for these parameters would increase for other rural co-operative banks, while existing sectoral exposure limits would be withdrawn except for the real estate sector. Regulated entities and other stakeholders may submit comments by Aug. 28, 2026.
Reserve Bank of India2026-08-06
Reserve Bank of India launches consultation on rural co-operative bank exposure limits and housing loan flexibility
The Reserve Bank of India is consulting on revised concentration risk and credit facility rules for rural co-operative banks, including counterparty and unsecured exposure limits and higher housing loan limits. Larger banks would gain flexibility over housing loan tenors and moratoriums, while sectoral exposure limits would be withdrawn except for real estate.