- The Central Government has just released a Gazette notification that announces the key provisions of the Banking Laws (Amendment) Act, 2025 will take effect starting December 15, 2025.
- One of the most immediate changes will impact the cooperative banking sector, particularly with the implementation of Section 14, which modifies Section 56 of the Banking Regulation Act, 1949.
- These amendments will bring significant changes for cooperative banks by replacing the old alternate-Friday reporting cycle with a new “last day of the fortnight” system, aligning them more closely with commercial banks.
- Outdated regulations have been eliminated, allowing for modern regulatory compliance.
- Now, monthly and quarterly return filings will follow calendar-end dates, making submissions much simpler.
The Central Government has just released a Gazette notification that announces the key provisions of the Banking Laws (Amendment) Act, 2025 will take effect starting December 15, 2025.
One of the most immediate changes will impact the cooperative banking sector, particularly with the implementation of Section 14, which modifies Section 56 of the Banking Regulation Act, 1949.
These amendments will bring significant changes for cooperative banks by replacing the old alternate-Friday reporting cycle with a new “last day of the fortnight” system, aligning them more closely with commercial banks. Outdated regulations have been eliminated, allowing for modern regulatory compliance. Now, monthly and quarterly return filings will follow calendar-end dates, making submissions much simpler. Overall, cooperative banks will benefit from streamlined reporting, clearer oversight, and greater consistency in compliance.
Section 14 updates the special chapter that pertains to cooperative banks by transitioning them to the new “last day of the fortnight” reporting cycle, moving away from the outdated alternate-Friday system. This amendment also removes provisions that no longer fit with current regulatory practices, allowing cooperative banks to adopt the same modern reporting structure used throughout the banking sector.
In addition to the reforms specific to cooperatives, the Government has also enacted several amendments that affect the broader banking industry, including public sector, private sector, and foreign banks. These changes aim to modernize the CRR and SLR reporting systems and create uniformity in statutory return filings.
As part of these broader changes, Section 2 revises Section 42 of the Reserve Bank of India Act, 1934, redefining “fortnight” and moving CRR reporting to the last day of each fortnight. This adjustment aligns CRR calculations with the updated reporting cycle that is now being rolled out across the sector.
In a similar vein, Section 6 revises Section 18 of the Banking Regulation Act, bringing non-scheduled banks in line with updated statutory liquidity requirements under a fortnightly framework. Meanwhile, Section 7 updates Section 24 by refreshing the timelines for SLR reporting and the penalties for late compliance, all in an effort to foster a more transparent supervisory atmosphere.
The process for filing statutory returns has also seen some changes. Section 8 modifies Section 25 to require that quarterly returns be submitted on the last day of each quarter, moving away from the old last-Friday system. Additionally, Section 9, which revises Section 27, now mandates that monthly returns be filed on the last calendar day of each month, ensuring consistency across all types of banks.
Together, these amendments aim to streamline reporting timelines, eliminate outdated practices, and bring greater uniformity to India’s banking regulatory framework.
The notification from the Department of Financial Services officially puts into effect Sections 2, 6, 7, 8, 9, and 14 of the Act starting December 15. The Banking Laws (Amendment) Act, 2025 had previously received the President’s approval on April 15, 2025.
These reforms are anticipated to simplify compliance processes, align reporting cycles, and enhance supervisory oversight throughout the banking system.