Mumbai (Maharashtra) [India], November 29 : The Reserve Bank of India (RBI) has undertaken a significant overhaul of its regulatory framework, consolidating thousands of circulars and guidelines into a streamlined set of Master Directions.
According to the central bank, it was intended to ease compliance burdens for banks and other regulated entities.
The RBI issued 244 Master Directions, consolidating the instructions currently administered by the Department of Regulation on an 'as-is' basis.
"These instructions have been issued separately for 11 types of regulated entities and are cohesively organised across various regulatory areas," the RBI said in a statement.
According to the RBI, the consolidation exercise marks a "paradigm shift" in regulatory communication.
The 11 types of regulated entities identified are: (a) Commercial Banks; (b) Small Finance Banks; (c) Payments Banks; (d) Local Area Banks; (e) Regional Rural Banks; (f) Urban Co-operative Banks; (g) Rural Co-operative Banks; (h) All India Financial Institutions; (i) NonBanking Financial Companies; (j) Asset Reconstruction Companies; and (k) Credit Information Companies.
The comprehensive exercise involved consolidation of more than 9000 existing circular/ guidelines administered by Department of Regulation into 238 function-wise Master Directions (MDs), specific to each category of regulated entity.
Instructions issued by NABARD to Regional Rural Banks, State Co-operative Banks and Central Cooperative Banks were also consolidated in consultation with NABARD.
This exercise, according to RBI, is expected to enhance clarity, ease of access, and reduce compliance burden for REs, thereby supporting the broader objective of improving ease of doing business.
The drafts of these MDs were placed on website of the Reserve Bank for public comments regarding completeness and accuracy dated October 10, 2025.
The Reserve Bank had received over 770 comments from various stakeholders on the draft MDs.
Several suggestions were for regulatory changes, which were outside the scope of this consolidation exercise, and hence have not been considered for the purpose of consolidation, RBI said. It added that the remaining comments, relevant to the finalisation of the MDs have been duly considered while finalising the consolidated MDs.
The Reserve Bank has issued numerous directions over the years, under the statutory powers conferred upon it by various Acts.
While increase in regulatory guidelines is a natural process as the financial system evolves, this was further driven by an expanding regulatory perimeter, distributed supervisory/ regulatory jurisdiction over certain regulated entities, and non-repeal of some of the earlier instructions when new ones were issued.
Being mindful of compliance burden to the Regulated Entities (REs), the Reserve Bank said it has continuously endeavoured to optimise its regulatory framework.
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