Reserve Bank of India (Small Finance Banks – Undertaking of Financial Services) (Amendment) Directions, 2025

RBI/DOR/2025-26/136
DOR.RAUG.AUT.REC.No.346/24.01.041/2025-26
 

December 05, 2025

Reserve Bank of India (Small Finance Banks – Undertaking of Financial Services) (Amendment) Directions, 2025
 

Reserve Bank had earlier issued directions on Financial Services provided by Banks in 2016, since replaced by entity-wise Master Directions issued on November 28, 2025 - Reserve Bank of India (Small Finance Banks – Undertaking of Financial Services) Directions, 2025. A review of some provisions contained in the earlier instructions was carried out and a draft direction was placed on the website on October 04, 2024.
 

2. Taking into account the feedback received and consultation held with the stakeholders and in exercise of the powers conferred by Section 35A of the Banking Regulation Act, 1949 and all other laws enabling the Reserve Bank in this regard, the Reserve Bank being satisfied that it is necessary and expedient in the public interest to do so, hereby issues the Amendment Directions hereinafter specified.
 

3. These Directions shall be called the Reserve Bank of India (Small Finance Banks – Undertaking of Financial Services) (Amendment) Directions, 2025.
 

4. The provisions shall come into effect from December 05, 2025.
 

5. These Amendment Directions modify the Reserve Bank of India (Small Finance Banks - Undertaking of Financial Services) Directions, 2025 (hereinafter referred to as ‘Master Direction’) as under:
 

(i) In paragraph 4 of the Master Direction, the following sub-paras shall be inserted/substituted as follows:

a) in sub-para (1), the following shall be substituted, namely: -

“Agency Business: means an arrangement under which a bank acts as an agent of a third-party product or service provider (TPPSP), without risk participation, to facilitate the sale of the latter’s financial products or services (e.g., insurance, mutual fund, pension fund, etc.) to its own customers. Under agency business arrangement, the bank shall enter into an agreement with a TPPSP for sale of only regulated financial products or services. The activities covered under agency business arrangements may inter-alia include marketing, sales, promotion, initial point of contact for redressal of grievance and other after-sale services related to the product or service.”
 

b) the existing sub-para (1) in the Master Direction, which defines Assignee, has been renumbered as (1A).
 

c) for sub-para (14), the following shall be substituted, namely: -

View Attachment