RBI (Commercial Banks – CRR and SLR) Directions, 2025

The Reserve Bank of India has released the Commercial Banks – Cash Reserve Ratio and Statutory Liquidity Ratio (CRR/SLR) Directions, 2025 through Notification dated November 28, 2025.

These Directions consolidate, update, and replace all earlier instructions governing the maintenance of Cash Reserve Ratio (CRR) and Statutory Liquidity Ratio (SLR) by commercial banks in India. They became effective immediately upon issuance.

This guide provides a clear, comprehensive breakdown of the Directions, ideal for bankers, finance professionals, compliance officers, and students preparing for banking exams.

What Are the RBI CRR & SLR Directions, 2025?

Issued under Section 35A of the Banking Regulation Act, 1949 (BR Act), Section 42 of the RBI Act, 1934, and Sections 18 and 24 of the BR Act, these Directions apply to all Commercial Banks, except Small Finance Banks, Local Area Banks, and Payments Banks (as defined under Section 5 of the BR Act).

1. Understanding CRR (Cash Reserve Ratio)

CRR is the percentage of a bank’s Net Demand and Time Liabilities (NDTL) that must be maintained with the RBI in the form of cash balances. These balances cannot be used for lending or investment.

1.1 CRR Requirement (Para 9)

Banks must maintain the following average daily CRR on the basis of NDTL reported as on the last Friday of the second preceding fortnight:

1.2 Daily Minimum Requirement (Para 10)

Banks must maintain at least 90% of the required CRR on all days of the reporting fortnight.

1.3 Incremental CRR (Para 8)

The RBI may impose an additional CRR on incremental NDTL under Section 42(1A) of the RBI Act.

1.4 NDTL Computation for CRR (Paras 11, 14, 15)

NDTL comprises:

• Net liabilities to the banking system (after netting corresponding assets)
• Demand and time liabilities to others
• Liabilities arising from foreign borrowings (treated as “liabilities to others”)
• Upper Tier II instruments

Savings bank deposits are apportioned based on averages as on March 31 and September 30 for the ensuing half-year (Para 6(2)).

1.5 Liabilities Excluded from NDTL (Para 19)

The following are excluded:

• Paid-up capital and reserves
• Tier 1 and Additional Tier 1 capital instruments
• Loans/refinance from RBI, NABARD, EXIM Bank, NHB, NaBFID, SIDBI
• Net income tax provisions
• DICGC/ECGC claims pending adjustment
• Market repo borrowings against government securities
• Certain subsidies and unrealised gains on derivatives

1.6 CRR-Exempted Liabilities (Para 20)

No CRR is required on:

• Net inter-bank liabilities (after netting)
• Asian Clearing Union (ACU) balances
• Offshore Banking Unit (OBU) and IFSC Banking Unit liabilities
• Eligible Credit versus Long-Term Bonds (EC vs LB)
• Market repos against government securities
• Incremental FCNR(B) and NRE term deposits mobilized between July 1 and November 4, 2022 (base date: July 1, 2022)

1.7 Lag in CRR Maintenance (Para 21)

CRR is maintained with a one-fortnight lag, providing banks additional time for liquidity planning.

1.8 No Interest on CRR Balances (Para 22)

The RBI does not pay interest on CRR balances maintained by Scheduled Commercial Banks.

2. Understanding SLR (Statutory Liquidity Ratio)

SLR is the percentage of NDTL that banks must maintain in the form of cash, gold, or unencumbered approved securities.

2.1 SLR Requirement (Paras 24–25)

Banks must maintain not less than 18% of NDTL. The RBI may increase this requirement up to 40% through a separate notification.

2.2 Eligible SLR Assets (Para 28)

Eligible assets include:

• Cash
• Gold (valued at current market price)
• Unencumbered government securities (GOI dated securities, Treasury Bills, State Development Loans) held in SGL, CSGL, or dematerialised form
• Excess CRR balances
• Balances maintained under the Standing Deposit Facility (SDF) (eligible for SLR but not for CRR)

2.3 Unencumbered Securities (Para 28(5)–(6))

Securities are treated as unencumbered even if pledged for:

• Advances (to the extent unused)
• Collateral under MSF or FALLCR
• Acquisition through RBI-LAF or market repo

2.4 Treatment of Repo Transactions (Para 28(6)(ii)–(iii))

• Funds borrowed under repo in government securities are exempt from CRR and SLR computation.
• Securities acquired under repo are eligible for SLR maintenance.
• Corporate bond repos are treated as liabilities (netted if inter-bank).

3. Marginal Standing Facility (MSF) (Paras 26–27)

Scheduled banks may borrow overnight up to 2% of NDTL by dipping into their SLR portfolio.

• No separate waiver is required for falling below SLR due to MSF usage.
• SLR securities eligible under MSF are treated as Level 1 High Quality Liquid Assets (HQLA) for Liquidity Coverage Ratio (LCR) purposes.

4. NDTL Computation for SLR (Para 29)

NDTL for SLR is computed similarly to CRR, applying the same exclusions (Para 19) and additional exemptions (Para 20(4)–(7)). Inter-bank term deposits of all maturities must be included in liabilities to the banking system, with corresponding assets included under assets with the banking system.

5. Reporting Requirements

5.1 Fortnightly CRR Reporting – Form A (Paras 31–36)

Scheduled Commercial Banks must submit:

• Provisional Form A within 7 days of each alternate Friday
• Final Form A within 20 days of the fortnight end

The return includes NDTL computation, paid-up capital and reserves, break-up of foreign currency liabilities (Annex A), and investment details (Annex B). Reverse repos are reported based on residual maturity (≤14 days or >14 days). Returns must be filed electronically via the Centralised Information Management System (CIMS).

5.2 Monthly SLR Reporting – Form VIII (Paras 39–41)

Banks must submit Form VIII by the 20th of every month, covering:

• SLR assets held on alternate Fridays
• Daily SLR position
• Mode of valuation

NDTL figures must be certified by statutory auditors.

6. Penalties for Non-Compliance

6.1 CRR Defaults (Paras 42–45)

• Daily shortfall: Penal interest at 3% above Bank Rate (5% if continued on the next day)
• Shortfall in average CRR: Penalty under Section 42(3) of RBI Act
• Willful default: Fines on directors/officers under Section 42(3A)

6.6 SLR Defaults (Paras 46–48)

• Penal interest as prescribed under Section 24 of the BR Act
• Persistent default may lead to cancellation of banking licence

Late submission of returns attracts penalties under Sections 42(4) and 46(4) of the RBI Act.

7. Repeal of Earlier Instructions (Paras 49–50)

These Directions repeal all previous CRR and SLR circulars. Actions taken and approvals granted under earlier instructions remain valid.

8. Key Takeaways for Banks

• CRR will gradually reduce to 3.0% by November 29, 2025.
• Minimum daily CRR requirement is 90% of the prescribed average.
• SLR remains unchanged at 18% of NDTL.
• Detailed NDTL computation rules and exemptions promote accuracy.
• Repo transactions in government securities receive favourable SLR treatment.
• Enhanced reporting via Form A (with Annexes) and Form VIII strengthens transparency.
• Strict penal provisions reinforce compliance discipline.
• All prior CRR/SLR instructions stand repealed.

For the latest reporting templates and submission guidelines, visit the RBI CIMS portal.

Conclusion

The RBI (Commercial Banks – CRR and SLR) Directions, 2025 represent a significant modernisation of reserve maintenance regulations in India. By providing clear guidelines on NDTL computation, eligible assets, exemptions, reporting, and penalties, the Directions enhance transparency, ensure liquidity stability, and promote operational discipline across the banking sector. Banks are advised to implement robust systems for:

• Daily monitoring of CRR and SLR positions
• Accurate NDTL computation and auditor certification
• Timely electronic reporting through CIMS
• Effective utilisation of facilities such as MSF and SDF

These Directions simplify the interaction between statutory liquidity requirements and RBI liquidity facilities, enabling better liquidity management.