RBI News for June 2026
RBI governor says FDI outflows and forex swings are being monitored
Reserve Bank of India Governor Sanjay Malhotra said short-term fluctuations such as net foreign direct investment outflows and exchange-rate movements are cyclical and are being closely monitored by the central bank.
Speaking at a round-table in New York attended by global financial institutions and investors, Malhotra highlighted ongoing reforms aimed at simplifying regulations, improving ease of doing business and expanding market access for foreign investors.
RBI officials also showcased India’s macroeconomic strength, citing low inflation, manageable current account deficit and strong foreign exchange reserves of around $700 billion.
The discussions reinforced India’s position as one of the fastest-growing major economies and highlighted continued policy efforts to strengthen investor confidence and integrate domestic and global financial markets.
RBI proposes simpler and safer digital recurring payments
Reserve Bank of India has introduced the Digital Payments – E-Mandate Framework, 2026, aimed at making recurring digital payments more transparent, secure and customer-friendly.
Under the proposed norms, users must receive a 24-hour pre-debit notification detailing the merchant name, amount, timing and reason for the debit. Customers will also be able to modify, pause or cancel mandates at any time and set limits for recurring payments.
The framework strengthens customer control over automated transactions while retaining safeguards through additional authentication such as OTP verification for cancellation requests.
The move is expected to improve trust in digital payments and promote a more consent-driven ecosystem for autopay services across banking and fintech platforms.
RBI cancels Paytm Payments Bank licence
Reserve Bank of India has cancelled the banking licence of Paytm Payments Bank Limited with immediate effect and will initiate winding-up proceedings before the High Court.
The RBI stated that the bank’s operations were conducted in a manner detrimental to depositors and public interest. The regulator added that the bank has sufficient liquidity to repay all deposit liabilities during the winding-up process.
While the closure is not expected to materially affect One97 Communications’s core operations, analysts believe the move may increase regulatory scrutiny on group entities and future licensing prospects.
The development marks one of the most significant regulatory actions against a payments bank in India.
RBI launches Mission SAKSHAM for co-operative banks
Reserve Bank of India has launched Mission SAKSHAM, a nationwide capacity-building initiative for Urban Co-operative Banks (UCBs).
The mission aims to improve managerial capabilities, operational efficiency, compliance culture and institutional resilience across the co-operative banking sector.
Designed as a mission-mode training programme, the initiative seeks to create a sustainable ecosystem for continuous learning and skill enhancement within UCBs. RBI said the programme would contribute to stronger governance standards, better risk management and improved stability in the co-operative banking system.
The initiative comes as regulators continue efforts to strengthen the operational and financial health of urban co-operative banks across India.
RBI and ECB sign fresh MoU on central banking cooperation
Reserve Bank of India and European Central Bank have signed a new Memorandum of Understanding (MoU) to strengthen cooperation in central banking and financial sector matters.
The agreement was signed by RBI Governor Sanjay Malhotra and ECB President Christine Lagarde on the sidelines of the Bank for International Settlements meetings in Basel.
The renewed MoU replaces the earlier arrangement signed in 2015 and establishes a framework for regular policy dialogue, information exchange and technical cooperation between the two institutions.
The RBI said the updated agreement would deepen institutional engagement and support collaboration on evolving financial sector developments and central banking practices.
RBI relaxes approval norms for outward remittance tie-ups
Reserve Bank of India has removed the requirement for non-bank entities to obtain prior approval before forming tie-up arrangements for outward remittance services through authorised dealer banks in India.
Under the revised framework, banks will now be responsible for ensuring compliance with FEMA regulations and Know Your Customer norms for such transactions. The move is expected to simplify and speed up digital outward remittance services offered through websites, mobile applications and online platforms.
The relaxation forms part of RBI’s efforts to improve ease of doing business and streamline cross-border financial transactions while maintaining regulatory oversight through authorised dealer banks.
RBI cancels registration of seven NBFCs
Reserve Bank of India has cancelled the certificates of registration of seven non-banking financial companies (NBFCs) after they surrendered their licences or ceased to require registration.
Some entities exited the non-banking financial business entirely, while others qualified as unregistered core investment companies that do not need RBI registration. One entity’s registration was cancelled following its merger or dissolution.
The move reflects ongoing regulatory efforts to streamline the NBFC sector and ensure only active and compliant entities remain under the regulatory framework.
RBI announces Rs. 30,000 crore government bond switch auction
Reserve Bank of India announced a switch auction for Rs. 30,000 crore worth of government securities aimed at managing the maturity profile of public debt.
Under the operation, shorter-term bonds maturing between 2027 and 2030 will be exchanged for longer-tenor securities maturing between 2035 and 2060.
The switch exercise is intended to smoothen the government’s redemption obligations and reduce refinancing pressure in the coming years. The securities involved include several benchmark government bonds across medium and long-term maturities.
Such switch operations are regularly used by the government and RBI to improve debt management efficiency and support stability in the government securities market.
Rohit Jain appointed RBI Deputy Governor
Reserve Bank of India Executive Director Rohit Jain has been appointed Deputy Governor of the central bank for a three-year term beginning on or after May 3, 2026.
Jain, who has spent around three decades at the RBI, has handled several key functions, including banking supervision, which he oversaw as Executive Director before his elevation. He succeeds T Rabi Sankar, whose tenure ended after extensions granted in 2024 and 2025.
The appointment was approved by the Appointments Committee of the Cabinet. Industry observers expect a reshuffle of departmental responsibilities among RBI deputy governors following Jain’s appointment.
Jain joins SC Murmu as the second deputy governor promoted from within the RBI, alongside external appointees Poonam Gupta and Swaminathan J.
RBI penalises Bandhan Bank and Muthoot Housing
Reserve Bank of India has imposed a penalty of Rs. 41.8 lakh on Bandhan Bank for non-compliance with regulatory norms, including Know Your Customer guidelines.
The RBI said the bank failed to conduct periodic review of risk categorisation for certain accounts and had sanctioned director-related loans.
Separately, the central bank imposed a penalty of Rs. 80,000 on Muthoot Housing Finance Company for non-compliance with directions related to the Fair Practice Code.
The RBI clarified that the penalties relate to deficiencies in regulatory compliance and do not question the validity of transactions entered into with customers.
RBI revises lending norms for urban co-operative banks
Reserve Bank of India has issued revised lending guidelines for Urban Co-operative Banks (UCBs), tightening unsecured loan exposure and strengthening risk management practices.
Under the new norms, aggregate unsecured lending has been capped at 20% of total loans. Individual unsecured loan limits have also been prescribed based on the size category of UCBs.
The RBI has additionally tightened housing loan rules, capping loan tenure for smaller UCBs at 20 years and restricting moratorium periods for under-construction properties to 24 months.
Further, UCBs have been barred from extending loans against fixed deposits issued by other banks to reduce interconnected risks within the financial system.
The revised framework aims to improve financial discipline and strengthen the stability of the co-operative banking sector.
RBI creates deregistration route for small NBFCs
Reserve Bank of India has issued final guidelines allowing certain small non-banking financial companies (NBFCs) to exit the regulatory framework through a structured deregistration mechanism.
NBFCs with assets below Rs. 1,000 crore that neither use public funds nor have customer interfaces will be classified as “Unregistered Type I NBFCs” and exempted from registration requirements. Existing eligible NBFCs can apply for deregistration by December 31, 2026 through the RBI’s PRAVAAH portal.
The central bank has mandated board resolutions, auditor certifications and audited financial statements to ensure only genuinely low-risk entities qualify. RBI also retains the authority to reject applications if it is not satisfied with the entity’s business model or compliance position.
Cabinet approves Rs. 2.55 lakh crore credit guarantee scheme
The Union Cabinet has approved the fifth edition of the Emergency Credit Line Guarantee Scheme (ECLGS 5.0) to support businesses affected by the West Asia crisis.
The scheme aims to facilitate credit flow of Rs. 2.55 lakh crore for MSMEs, non-MSMEs and airlines, backed by government guarantees. MSMEs will receive 100% guarantee coverage, while non-MSMEs and airlines will receive 90% coverage. A separate Rs. 5,000 crore allocation has been earmarked for airlines.
Prime Minister Narendra Modi said the initiative reflects the government’s commitment to supporting businesses and safeguarding livelihoods amid global uncertainty.
Loans sanctioned till March 31, 2027 will be eligible under the scheme, with capped interest rates for banks and NBFCs lending to MSMEs and non-MSMEs.
RBI ends fresh FFMC licences, introduces forex correspondents
Reserve Bank of India has decided to stop issuing fresh licences for full-fledged money changers (FFMCs) and replace the framework with a new forex correspondent model.
Under the revised structure, authorised dealer banks will appoint forex correspondents who can buy and sell foreign currency notes, handle travellers’ cheques and support remittance services. Existing franchisee arrangements under FFMCs will be phased out over a two-year transition period.
The RBI said the move simplifies the forex distribution framework and lowers entry barriers. The new regime also creates multiple authorisation categories for banks, NBFCs and forex entities with defined net-worth requirements and operational track records.
RBI revises disaster relief framework for stressed loans
Reserve Bank of India has overhauled its framework for handling loans impacted by natural calamities and other major disruptions.
Under the revised guidelines, banks must invoke resolution plans within 45 days of a calamity declaration and implement them within 135 days. Relief measures will apply to borrowers whose accounts were standard and not overdue by more than 30 days at the time of the event.
The framework covers natural disasters as well as disruptions such as riots that significantly affect economic activity. Banks can now initiate restructuring based on recommendations from banking committees without waiting for formal borrower requests, although customers retain the right to opt out.
The revised norms aim to ensure faster relief and improve financial resilience during crisis situations.
