RBI Circulars are an important part of current affairs preparation for candidates appearing for RBI Grade B and other banking and regulatory body exams. The August 2026 RBI Circulars cover important updates related to responsible business conduct, loan recovery practices, technology-based restrictions on financed devices, Priority Sector Lending (PSL), FCNR and NRE deposits, CRR and SLR exemptions, lead bank responsibility, NBFC concentration risk management, and interest rate relaxation on deposits.
Download RBI Circulars August 2026 Practice Quiz PDF
The RBI Circulars August 2026 Practice Quiz PDF covers important regulatory updates discussed in the August 2026 RBI Circular session.
| Particulars | Link |
|---|---|
| RBI Circulars August 2026 Quiz PDF | Download Free PDF |
| RBI Circulars August 2026 Details | Check Details |
Attempt the RBI Circulars August 2026 Practice Quiz
The RBI Circulars August 2026 Practice Quiz helps candidates test their understanding of the latest RBI regulatory updates through exam-oriented MCQs. The quiz covers important factual and conceptual points from the August 2026 circulars and can be useful for quick revision.
1. What is the central theme of the RBI circular on responsible business conduct discussed in the transcript?
2. Which of the following institutions is specifically stated in the transcript as NOT covered by the loan-recovery directions because it cannot give credit?
3. According to the transcript, recovery practices must protect which three borrower interests?
4. In the transcript, a recovery agency is described primarily as what?
5. Who may also work as a recovery agency, according to the transcript?
6. What is the role of recovery agents working under a recovery agency, as described in the transcript?
7. What must a bank maintain regarding collection and recovery?
8. What should the collection and recovery policy contain for cases where a borrower does not respond?
9. What certification requirement for recovery agents is mentioned in the transcript?
10. What must a bank publish regarding its recovery agencies?
11. For how long must records of recovery calls be preserved from the call date, according to the transcript?
12. When may a bank take possession of security provided by a borrower, according to the transcript?
13. If a borrower has defaulted on a housing loan, what does the transcript say about restricting the borrower’s unrelated mobile phone or laptop?
14. Technology-based restrictions on a device are permitted only when the dues arise from what?
15. What must the loan agreement do if technology-based restrictions may be used on a financed device?
16. What approach to device restrictions is required in the transcript?
17. Before a financed-device payment is 30 days past due, what restriction is permitted according to the transcript?
18. Once an amount is 30 days past due, what may begin if the borrower has not paid despite notices?
19. At what stage may the full set of restrictions permitted under the agreement apply to a financed device?
20. According to the transcript, outgoing calls cannot be restricted before the dues are how many days past due?
Quiz Summary
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What are the RBI Circulars covered in August 2026?
The August 2026 RBI Circulars discussed in the session mainly focus on banking regulations and procedural updates. Important areas include responsible business conduct and recovery agencies, restrictions on financed devices, Priority Sector Lending calculations, FCNR and NRE deposits, CRR and SLR exemptions, lead bank responsibility for new districts, NBFC concentration risk management, and interest rate rules for deposits.
- Responsible Business Conduct
- Loan recovery and engagement of recovery agencies
- Technology-based restrictions on financed devices
- Priority Sector Lending (PSL)
- FCNR and NRE deposits
- CRR and SLR exemptions
- Lead Bank Responsibility
- NBFC Concentration Risk Management
- Interest Rate on Deposits
What is the RBI update on responsible business conduct?
The RBI has revised instructions related to loan recovery and the engagement of recovery agencies. The main objective is to ensure that recovery practices are carried out responsibly and ethically. Banks and other regulated entities must ensure that borrowers are treated fairly during the recovery process. The dignity, privacy, and fair treatment of borrowers must be protected while recovering dues.
- Recovery practices must protect the borrower’s dignity and privacy.
- Borrowers must receive fair treatment during recovery.
- Regulated entities should maintain a policy for collection and recovery.
- The policy should include suitable escalation mechanisms.
- Recovery agencies may be appointed to assist in recovering dues.
- A Business Correspondent may also work as a recovery agent in applicable cases.
What is a recovery agency under the RBI directions?
A recovery agency is an external entity or individual engaged under an outsourcing arrangement to assist a bank in recovering dues from a defaulting borrower. The recovery agency may have recovery agents who carry out activities such as contacting or visiting borrowers for recovery. RBI has prescribed requirements to ensure that recovery activities are carried out in a responsible manner.
- Recovery agencies work under an outsourcing arrangement.
- They assist banks in recovering dues from defaulting borrowers.
- Recovery agencies must engage agents holding the required Indian Institute of Banking and Finance (IIBF) certificate.
- Banks must publish an updated list of empanelled recovery agencies.
- Records of recovery calls and related information must be maintained.
- Records must be preserved for 6 months from the date of the call.
- Possession of security must be taken only in accordance with legally valid provisions and the loan agreement.
What are the RBI rules for technology-based restrictions on financed devices?
The RBI has provided a framework for technology-based restrictions on devices financed by a bank or regulated entity. If a borrower has taken financing specifically to purchase a device such as a mobile phone, laptop, or tablet and fails to repay the dues, certain restrictions may be imposed subject to the applicable conditions. However, such restrictions must be gradual and must be clearly provided in the loan agreement.
- Restrictions can be used only for recovering dues arising from financing of that particular device.
- The loan agreement should clearly mention the permitted restrictions.
- Restrictions should be applied gradually.
- No restriction or disablement is permitted during the first 30 days past due.
- After 30 days past due, gradual restrictions may begin subject to the applicable conditions.
- After 60 days past due, the full set of restrictions permitted under the agreement may apply.
- Outgoing calls cannot be restricted before 60 days past due.
- Incoming calls, SMS, and emergency SOS features cannot be blocked.
- Access required for the borrower’s work or employment should not be denied.
- Personal data such as contacts and SMS should not be misused or accessed improperly.
- Restrictions should be restored after the borrower pays the outstanding dues.
What is the important timeline for restrictions on financed devices?
The timeline for technology-based restrictions is an important factual area for exam preparation.
| Period | Restriction |
|---|---|
| Before 30 days past due | No restriction or disablement |
| After 30 days past due | Gradual restrictions may begin |
| Before 60 days past due | Outgoing calls cannot be restricted |
| After 60 days past due | Full permitted restrictions may apply as per the agreement |
What is the August 2026 RBI update on Priority Sector Lending?
The RBI has amended the Priority Sector Lending (PSL) framework relating to the calculation of the Adjusted Net Bank Credit (ANBC). Eligible FCNR and NRE deposits are excluded from the calculation of ANBC for determining the applicable PSL target. This provides relief to banks by reducing the base on which their PSL target is calculated.
- PSL targets are linked to the bank’s ANBC.
- Eligible FCNR and NRE deposits are excluded from ANBC.
- A lower ANBC results in a lower PSL target in absolute terms.
- The measure provides an incentive for banks to mobilise eligible foreign currency and NRE deposits.
- This amendment is important for understanding the calculation of PSL requirements.
What is the treatment of eligible FCNR and NRE deposits under PSL?
Eligible FCNR and NRE deposits receive specific treatment while calculating ANBC for PSL purposes. The eligible amount is excluded from the relevant calculation, which reduces the amount on which the PSL percentage is applied.
For example, if the applicable ANBC is ₹1,000 crore and ₹100 crore represents eligible FCNR and NRE deposits, the relevant ANBC after exclusion would be ₹900 crore. If the applicable PSL target is 40%, the PSL requirement would reduce from ₹400 crore to ₹360 crore.
This means the bank would have ₹40 crore more that can be deployed outside the PSL requirement, subject to other applicable regulations.
What are FCNR and NRE accounts?
FCNR(B) stands for Foreign Currency Non-Resident (Bank) Account. It is a term deposit account in which eligible foreign currency can be maintained. In contrast, an NRE account or Non-Resident External Account is maintained in Indian Rupees.
| Account | Important Feature |
|---|---|
| FCNR(B) | Term deposit maintained in foreign currency |
| NRE | Account maintained in Indian Rupees |
Eligible FCNR and NRE deposits are important in the August 2026 RBI updates because they receive specific treatment under PSL, CRR, SLR, and deposit interest-rate provisions.
What is the revised eligibility period for FCNR and NRE deposits?
The transcript highlights the eligibility conditions and revised cut-off date applicable to the relevant FCNR and NRE deposit provisions.
- Eligible FCNR deposits should have a minimum tenure of 3 years.
- The maximum tenure for eligible FCNR deposits is 5 years.
- Eligible NRE deposits should have a minimum tenure of 3 years or more.
- The revised cut-off date is 31 August 2026.
- The earlier cut-off date of 30 September was revised to 31 August 2026.
What is the RBI update on CRR and SLR exemption for FCNR and NRE deposits?
The RBI has provided an exemption from Cash Reserve Ratio (CRR) and Statutory Liquidity Ratio (SLR) requirements for specified eligible FCNR and NRE deposits. The August 2026 update mainly changes the cut-off date associated with this temporary exemption.
- Specified eligible FCNR deposits receive CRR and SLR exemption.
- Specified eligible NRE deposits also receive the exemption.
- The revised cut-off date is 31 August 2026.
- Eligible FCNR deposits have a minimum tenure of 3 years and maximum tenure of 5 years.
- Eligible NRE deposits have a minimum tenure of 3 years.
- The same direction is applicable across the relevant categories of banks covered by RBI.
What is the difference between CRR and SLR?
Cash Reserve Ratio (CRR) is the portion of specified bank liabilities that banks are required to maintain with the Reserve Bank of India. Statutory Liquidity Ratio (SLR) is maintained by banks in specified liquid assets as prescribed by RBI.
| Particular | CRR | SLR |
|---|---|---|
| Full Form | Cash Reserve Ratio | Statutory Liquidity Ratio |
| Maintained | With RBI | By the bank |
| Purpose | Maintain reserve with RBI | Maintain liquidity through specified assets |
What is the RBI update on lead bank responsibility?
The RBI has assigned lead bank responsibility for newly created districts. The August 2026 update discussed in the transcript relates to the newly created districts in the Union Territory of Ladakh, for which State Bank of India (SBI) has been assigned the lead bank responsibility.
- New districts require the assignment of lead bank responsibility.
- For the newly created districts in Ladakh discussed in the circular, State Bank of India has been assigned the lead bank responsibility.
What is the RBI update on NBFC concentration risk management?
The RBI has extended the applicability of the relevant Concentration Risk Management Directions to Infrastructure Debt Funds (IDFs) that are subject to the applicable upper-layer regulations. The update relates to the large exposure limits that were part of the earlier regulatory framework.
- The earlier Concentration Risk Management Directions were issued in 2025.
- The relevant provisions are now applicable to Infrastructure Debt Funds covered by the applicable upper-layer framework.
- Large exposure limits are relevant under the framework.
- This update is mainly procedural but can be useful for exam-based factual questions.
What is the RBI update on interest rates for FCNR and NRE deposits?
The RBI has temporarily relaxed the interest-rate ceiling applicable to specified FCNR and NRE deposits. Under the temporary relaxation, banks can offer interest rates without the usual ceiling, subject to the applicable conditions. The August 2026 update shortened the period for which this relaxation is available.
- The temporary interest-rate ceiling relaxation applies to specified eligible FCNR and NRE deposits.
- The relaxation was earlier available up to 30 September 2026.
- The revised cut-off date is 31 August 2026.
- Eligible deposits are subject to the prescribed tenure conditions.
- The measure is intended to encourage mobilisation of foreign currency and NRE deposits.
What are the most important RBI Circulars August 2026 facts for exams?
Candidates should revise the following facts before attempting the RBI Circulars August 2026 Practice Quiz:
| Topic | Important Fact |
|---|---|
| Responsible Business Conduct | Protect borrower dignity, privacy and fair treatment |
| Recovery Agency | Must engage agents with the required IIBF certificate |
| Recovery call records | Preserve records for 6 months from the call date |
| Financed device restrictions | No restriction before 30 days past due |
| Financed device restrictions | Full permitted restrictions may apply after 60 days past due |
| Outgoing calls | Cannot be restricted before 60 days past due |
| Essential features | Incoming calls, SMS and emergency SOS cannot be blocked |
| PSL | Eligible FCNR and NRE deposits excluded from ANBC |
| FCNR(B) | Foreign currency term deposit |
| NRE | Maintained in Indian Rupees |
| Eligible FCNR tenure | Minimum 3 years, maximum 5 years |
| Eligible NRE tenure | Minimum 3 years |
| Revised cut-off date | 31 August 2026 |
| CRR/SLR exemption | Available for specified eligible FCNR and NRE deposits |
| Lead Bank Responsibility | SBI assigned for newly created districts in Ladakh discussed in the update |
| NBFC update | Concentration risk provisions extended to applicable IDFs |
| Interest-rate relaxation | Temporary ceiling relaxation revised up to 31 August 2026 |
FAQs
It is an MCQ-based quiz covering important RBI circular updates discussed for August 2026.
The revised cut-off date is 31 August 2026.
The minimum tenure for eligible FCNR deposits is 3 years.
The maximum tenure for eligible FCNR deposits is 5 years.
Recovery call records should be preserved for 6 months from the call date.
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