**Policy Summary: RBI/2020-21/62 - Opening of Current Accounts by Banks: Need for Discipline**
This circular, issued by the Reserve Bank of India (RBI) on November 2, 2020, under reference number DOR.No.BP.BC.2721/04.048/2020-21, addresses the opening of current accounts by banks. It pertains to all scheduled commercial banks and payments banks.
The circular provides an extension to the deadline for compliance with instructions outlined in Para 4 of circular DOR.No.BP.BC/721/04.048/2020-21 dated August 6, 2020. Banks are now required to ensure compliance by December 15, 2020, instead of the original deadline of November 5, 2020.
The extension is granted due to pending clarifications on operational issues raised by banks regarding the maintenance of existing current and Cash Credit/Overdraft (CC/OD) accounts. These clarifications will be addressed separately in a forthcoming Frequently Asked Questions (FAQ) document.
All other instructions stipulated in the August 6, 2020 circular remain in effect.
Contact: Prakash Baliarsingh, Chief General Manager.
Key Entities Referenced
Reserve Bank: The Reserve Bank is examining references from banks and will clarify operational issues by means of a FAQ.
All Scheduled Commercial Banks: Addressees of the circular regarding opening of current accounts.
All Payments Banks: Addressees of the circular regarding opening of current accounts.
DOR.No.BP.BC.2721/04.048/2020-21: Reference number of the current circular being analyzed.
August 6, 2020: Date of the original circular regarding opening of current accounts.
November 5, 2020: Original deadline for compliance with instructions regarding current and CCOD accounts.
December 15, 2020: Revised deadline for banks to ensure compliance with instructions in Para 4 of the circular.
Prakash Baliarsingh: Chief General Manager
RBI/2020-21/62
DOR.No.BP.BC.27/21.04.048/2020-21 November 02, 2020
All Scheduled Commercial Banks
All Payments Banks
Madam / Dear Sir,
Opening of Current Accounts by Banks - Need for Discipline
Please refer to our circular DOR.No.BP.BC/7/21.04.048/2020-21 dated August 6, 2020 on
the captioned subject.
2. In this connection, a reference is invited to Para 4 of the circular referred to above,
wherein the banks were advised that in respect of existing current and CC/OD accounts,
banks shall ensure compliance with the above instructions within a period of three months
from the date of issue of the circular i.e. by November 5, 2020. We have since received
several references from banks seeking clarifications on operational issues regarding
maintenance of current accounts already opened by the banks. These references are being
examined by the Reserve Bank and will be clarified separately by means of a FAQ.
3. Pending the issue of FAQ on these operational issues, it has been decided that banks
may ensure compliance with the instructions contained in Para 4 of the circular ibid by
December 15, 2020.
4. All other instructions contained in our circular dated August 6, 2020, remain unchanged.
Yours faithfully,
(Prakash Baliarsingh)
Chief General Manager