Regulatory Alerts2026-08-06
Added · Updated
Reserve Bank of India (Small Finance Banks - Responsible Business Conduct) Fourth Amendment Directions, 2026
These Directions amend the Reserve Bank of India (Small Finance Banks – Responsible Business Conduct) Directions, 2025, by inserting definitions for recovery agencies and agents and replacing paragraphs 408 to 416 and 442 to 454 with new provisions governing loan recovery conduct. Small Finance Banks (SFBs) are required to establish policies for recovery, including due diligence, training, and codes of conduct, while recovery agents must hold certificates from the Indian Institute of Banking and Finance (IIBF). The rules mandate specific disclosure requirements, fair treatment standards, and restrictions on harsh recovery practices, alongside detailed regulations for technology-based mechanisms that restrict mobile device functionalities. These Directions come into effect on January 1, 2027.
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