The Reserve Bank of India on Monday announced amendments to the Liquidity Coverage Ratio (LCR), directing banks to assign additional run-off rates of 2.5% to internet and mobile banking-enabled retail and small business customer deposits.

The Reserve Bank has undertaken an impact analysis of the above measures based on data submitted by banks, as on December 31, 2024. It is estimated that the net impact of these measures will improve the LCR of banks, at the aggregate level, by around 6 percentage points as on that date.

Further, all the banks would continue to meet the minimum regulatory LCR requirements comfortably. "Reserve Bank is sanguine that these measures will enhance the liquidity resilience of banks in India, and further align the guidelines with the global standards in a non-disruptive manner," said RBI in a statement.

Consequently, funding from non-financial entities like trusts (educational, charitable and religious), partnerships, LLPs, will attract a lower run-off rate of 40% as against 100% currently.

To give the banks adequate time to transition their systems to the new standards for LCR computation, the revised instructions shall become applicable w.e.f. April 1, 2026.