**Summary:**
This circular, DBR.No.Ret.BC.5812.01.001/2016-17, issued by the Reserve Bank of India (RBI) on April 6, 2017, announces a change in the Bank Rate. As stated in the First Bi-Monthly Monetary Policy Statement 2017-18, the Bank Rate is adjusted downward by 25 basis points, from 6.75% to 6.50%, effective April 6, 2017. Consequently, all penal interest rates on shortfalls in reserve requirements specifically linked to the Bank Rate are also revised. The penal interest rates on shortfalls in reserve requirements are Bank Rate plus 3.0 percentage points (9.50 per cent or 9.75 per cent depending on duration of shortfalls) and Bank Rate plus 5.0 percentage points (11.50 per cent or 11.75 per cent).
For further information, 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/CEOs of all Scheduled and Non-Scheduled Banks.
Key Entities Referenced
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.
Bank Rate: The standard rate at which the Reserve Bank of India is prepared to buy or rediscount bills of exchange or other commercial paper eligible for purchase under the Reserve Bank of India Act.
First BiMonthly Monetary Policy Statement 201718: A monetary policy statement issued by the Reserve Bank of India.
Saurav Sinha: Chief General Manager at the Reserve Bank of India, signatory of the circular.
Department of Banking Regulation: A department within the Reserve Bank of India responsible for regulating banks.
Mumbai, Maharashtra: City in India where the Central Office of the Department of Banking Regulation is located.
भारतीय ररज़र् व बकैं
_____________ RESERVE BANK OF INDIA_____________
www.rbi.org.in
RBI/2016-17/270
DBR.No.Ret.BC.58/12.01.001/2016-17 April 06, 2017
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.19/12.01.001/2016-17 dated October
04, 2016 on the captioned subject.
2. As announced in the First Bi-Monthly Monetary Policy Statement 2017-18
dated April 06, 2017, the Bank Rate stands adjusted by 25 basis points from 6.75
per cent to 6.50 per cent with effect from April 06, 2017.
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,
(Saurav Sinha)
Chief General Manager
Encl. : As above
बकैं िंग विनियमि विभाग, ेंद्रीय ायाालय, 5ि िं मिंजिल, अमर भिि, सर प एम रोड , Ÿé¿¤¸ƒÄ 400001
Department of Banking Regulation, Central Office, 5th floor, Amar Building, Sir P.M. Road, Mumbai-400001
टेलीफोि/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
(Effective from April 06, 2017)
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).