RBI Revises Current Account Guidelines, Big Borrowers Face New Restrictions

RBI Rules: The Reserve Bank of India (RBI) has rolled out some big changes to current account rules, starting April 1, 2026. These new guidelines are designed to keep a closer eye on how money moves between banks, prevent fraud or circular transactions, and boost credit discipline. For companies borrowing from multiple banks, managing cash on a daily basis is going to get a lot more complicated than it used to be.

Good news for those with loans under Rs 10 crore (around $10 million): The RBI has given a big break to small and medium businesses. There are no new restrictions for companies that have total borrowings from banks of less than Rs 10 crore (about $10 million). These borrowers can still open and manage current accounts with any bank just like before. They won’t have to worry about fund transfer deadlines or extra scrutiny. The RBI thinks that tightening rules on small businesses could hurt their growth, so they’ve been left out of this new framework.

Tougher rules for loans of Rs 10 crore or more: For companies with total loan exposure of Rs 10 crore or more, the rules are getting pretty strict. In these cases, only banks that hold at least a 10% share of the total loan can operate a full current account. Banks with less than a 10% share can only set up a ‘collection account’. This account can only accept deposits; withdrawals won’t be allowed. No cheque books, debit cards, or cash/online transfer options will be available. All funds received in this account must be transferred to the main current account or CC/OD account of the company within two working days.

The RBI has also clarified that accounts required by FEMA or other legal or government directives will be exempt from these rules. Non-eligible banks may open limited accounts for certain banking products, but these will be receiving accounts only. To ensure compliance, banks will be required to review such accounts every six months.

If any violations are found, a notice must be issued within one month, and the account must be closed or converted to a collection account within three months. Overall, these new RBI rules are certainly stricter for large businesses, but they are expected to make the banking system more transparent, secure, and disciplined.