Overview

• The Reserve Bank of India has set a 2.5% additional run-off factor for digital retail deposits, down from the initially proposed 5%.
• Stable retail deposits will now carry a 7.5% run-off rate, while less stable deposits will have a 12.5% rate, up from the previous 5% and 10%, respectively.
• Wholesale funding from non-financial entities like trusts and partnerships will attract a reduced run-off rate of 40%, compared to the earlier 100%.
• The revised Liquidity Coverage Ratio guidelines will take effect on April 1, 2026, allowing banks sufficient time to transition.
• RBI's impact analysis estimates the measures will improve banks' aggregate LCR by 6 percentage points, with all banks continuing to meet minimum regulatory requirements.