**Policy Summary: Change in Bank Rate**
This circular, RBI201819117 DBR.No.Ret.BC.2312.01.001201819, issued by the Reserve Bank of India (RBI) on February 7, 2019, announces a reduction in the Bank Rate by 25 basis points, from 6.75% to 6.50%, effective immediately. This change was announced in the Sixth Bi-Monthly Monetary Policy Statement 2018-19, also dated February 7, 2019. Consequently, all penal interest rates on shortfalls in reserve requirements specifically linked to the Bank Rate are revised as detailed in the Annex. The annexure specifies that penal interest rates on shortfalls in reserve requirements will be Bank Rate plus 3.0 percentage points or 9.50 per cent (previously 9.75 per cent) or Bank Rate plus 5.0 percentage points or 11.50 per cent (previously 11.75 per cent), depending on the duration of the shortfalls. For inquiries, contact the Department of Banking Regulation, Central Office, 5th floor, Amar Building, Sir P.M. Road, Mumbai – 400001, Tel No: 022-22603000, Email ID: returnscorbi.org.in. The circular is addressed to the Chairpersons and CEOs of all Scheduled and Non-Scheduled Banks. Dr. S.K. Kar, Chief General Manager, is the signatory.
Key Entities Referenced
Bank Rate: The official interest rate at which a nation's central bank lends money to commercial banks.
Reserve Bank of India: The central bank of India, responsible for monetary policy and regulation of the banking system.
Scheduled Banks: Banks included in the Second Schedule of the Reserve Bank of India Act, 1934.
Non Scheduled Banks: Banks not included in the Second Schedule of the Reserve Bank of India Act, 1934.
Sixth Bi-Monthly Monetary Policy Statement 2018-19: A statement released by the Reserve Bank of India outlining the monetary policy for the specified period.
Mumbai, Maharashtra: The city in Maharashtra where the Central Office of the Department of Banking Regulation is located.
DBR.No.Ret.BC.2312.01.001/2018-19: Reference number of the policy document issued by the Department of Banking Regulation of RBI.
DBR.No.Ret.BC.0312.01.001/2018-19: Reference number of a previous circular related to the Bank Rate.
RBI/2018-19/117
DBR.No.Ret.BC.23/12.01.001/2018-19 February 07, 2019
The Chairperson / CEOs of all Scheduled and Non Scheduled Banks
Dear Sir / Madam,
Change in Bank Rate
Please refer to our circular DBR.No.Ret.BC.03/12.01.001/2018-19 dated August
01, 2018 on the captioned subject.
2. As announced in the Sixth Bi-Monthly Monetary Policy Statement 2018-19
dated February 07, 2019, the Bank Rate stands adjusted by 25 basis points from
6.75 per cent to 6.50 per cent with immediate effect.
3. All penal interest rates on shortfall in reserve requirements, which are
specifically linked to the Bank Rate, also stand revised as indicated in the Annex.
Yours faithfully
(Dr.S.K.Kar)
Chief General Manager
Encl. : As above
Department of Banking Regulation, Central Office, 5th floor, Amar Building, Sir P.M. Road, Mumbai-400001
टेल�फोन/Tel No:022-22603000 Email ID: returnsco@rbi.org.inAnnex
Penal Interest Rates which are linked to the Bank Rate
Item Existing Rate Revised Rate
(With immediate effect)
Penal interest rates on Bank Rate plus 3.0 Bank Rate plus 3.0 percentage
shortfalls in reserve percentage points points (9.50 per cent) or Bank Rate
requirements (9.75 per cent) or Bank plus 5.0 percentage points (11.50
(depending on duration Rate plus 5.0 per cent).
of shortfalls). percentage points
(11.75 per cent).