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Guidelines on acceptance of bulk deposits by banks

Reserve Bank of India (RBI) has updated the guidelines on acceptance of bulk deposits by banks.

What are bulk deposits?

 “Bulk Deposit” means single Rupee term deposits of –

Deposit Banks
₹3 crore (earlier ₹2 crore) and above
  • Scheduled Commercial Banks [excluding Regional Rural Banks (RRBs)]
  • Small Finance Banks
₹1 crore (earlier ₹15 lakh) and above
  • Regional Rural Banks (RRBs)
  • Local Area Banks
  • Scheduled Primary (Urban) Co-operative Banks (UCBs) in Tier 3 & 4
₹15 lakh and above
  • Other UCBs


What are the revised guidelines on pre-mature withdrawal option?

  • Commercial Banks shall have the freedom to offer term deposits without premature withdrawal option, provided that all term deposits accepted from individuals (held singly or jointly) for amount of ₹1 crore (earlier ₹15 lakh) and below shall have premature-withdrawal-facility.
  • Co-operative Banks shall have the freedom to offer term deposits without premature withdrawal option, provided that all term deposits accepted from individuals (held singly or jointly) and Hindu Undivided Families for amount of ₹1 crore (earlier ₹15 lakh) and below shall have premature-withdrawal-facility.

What are the revised guidelines on NRE / NRO term deposits?

Interest rates on NRE / NRO term deposits shall vary only on account of one or more of the following reasons –

Tenor of Deposits Commercial Banks and Co-operative Banks shall have the freedom to determine the maturity / tenor of the deposit subject to the condition that minimum tenor of NRE term deposits shall be 1 year and that of NRO term deposits shall be 7 days.
Size of Deposits Differential interest rate shall be offered only on bulk deposits.
Non-availability of Premature withdrawal option Commercial Banks and Co-operative Banks shall have the freedom to offer NRE / NRO term deposits without premature withdrawal option, provided that all NRE / NRO term deposits accepted from individuals (held singly or jointly) for amount of ₹1 crore and below shall have premature-withdrawal-facility.


References

Reserve Bank of India. (2023, October 26). 'Non-Callable Deposits - Master Direction on Interest Rate on Deposits'. Retrieved from https://www.rbi.org.in/Scripts/NotificationUser.aspx?Id=12555&Mode=0

Reserve Bank of India. (2023, October 26). 'Review of Instructions on Bulk Deposits for Regional Rural Banks (RRBs)'. Retrieved from https://www.rbi.org.in/Scripts/NotificationUser.aspx?Id=12556&Mode=0

Reserve Bank of India. (2024, June 07). 'Amendment to Master Direction - Reserve Bank of India (Interest Rate on Deposits) Directions, 2016'. Retrieved from https://www.rbi.org.in/Scripts/NotificationUser.aspx?Id=12690&Mode=0

Reserve Bank of India. (2024, January 01). 'Review of Instructions on Bulk Deposits for Urban Co-operative Banks (UCBs)'. Retrieved from https://www.rbi.org.in/Scripts/NotificationUser.aspx?Id=12588&Mode=0


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