Reserve Bank deletes the paragraph on limits for non-option derivative contracts from its bank directions
19 October 2026
The Reserve Bank of India issued two notifications on 19 October 2026 that remove the same provision from two sets of directions. Notification RBI/2026-27/294 brings in the Reserve Bank of India (Commercial Banks - Miscellaneous) Second Amendment Directions, 2026, under which paragraph 37 of Section C, 'Limits for Non-Option Derivative Contracts', in Chapter IV of the Commercial Banks Miscellaneous Directions of 2025 stands deleted. Notification RBI/2026-27/295 brings in the Reserve Bank of India (Small Finance Banks - Miscellaneous) Amendment Directions, 2026, deleting the same Section C from the Small Finance Banks Miscellaneous Directions of 2025. Both were issued under Section 35A of the Banking Regulation Act, 1949, and the amended instructions come into effect immediately upon issuance. Both were signed by Chief General Manager Sunil T S Nair.
In plain words
Derivative Derivative contract — A financial contract whose value is based on an underlying rate, price or index.
SFB Small Finance Bank — A category of bank licensed by the Reserve Bank mainly to serve small borrowers and the unbanked.