In a major stride toward simplifying compliance and modernising financial governance, the Reserve Bank of India (RBI) on Friday rolled out seven new Master Directions focused on authorising digital banking channels for regulated entities. The move forms part of a large-scale consolidation effort aimed at improving clarity, accessibility and the overall ease of doing business for banks and financial institutions.
As part of this exercise, the RBI has now issued 244 Master Directions (MDs) after extensive stakeholder consultations. These MDs compile and restructure all existing instructions handled by the Department of Regulation, presented on an ‘as-is’ basis but organised in a streamlined manner for easier navigation.
The newly issued directions cover 11 categories of regulated entities (REs) and introduce seven specific MDs related to digital banking channels for:
- Commercial banks
- Small finance banks
- Payments banks
- Local area banks
- Regional rural banks
- Urban co-operative banks
- Rural co-operative banks
These digital banking guidelines will come into effect from January 1, 2026.
According to the RBI, the directions outline procedures, eligibility norms, technology standards, customer conduct guidelines, compliance expectations, and exemptions for providing digital banking services. They also mandate that every regulated entity frame a comprehensive digital banking policy, covering statutory and regulatory requirements, including liquidity management and operational risk in digital environments.
The central bank emphasised that the updated framework is intended to reduce unnecessary compliance load while ensuring robust digital banking governance across the sector.
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