RBI Update - Reserve Bank of India (Payments Banks – Governance) Amendment Directions, 2026

The Reserve Bank of India has issued the Reserve Bank of India (Payments Banks – Governance) Amendment Directions, 2026, effective from 1 October 2026, with the objective of rationalising Board governance requirements and enabling the Boards of Payments Banks to devote greater attention to strategic oversight and risk governance. The amendments introduce Paragraph 16A, requiring the Board to oversee the bank’s risk management framework, exposures to related entities, and compliance with corporate governance standards, while deleting certain existing provisions relating to Board reviews and governance matters (Paragraph 17 of Chapter IV and Paragraphs 22, 24, 25, 26 and 27 of Chapter V). The title of Chapter V has been revised from “Calendar of Reviews and Board Meeting Procedures” to “Matters to be placed before the Board”. Further, new Paragraphs 27A and 27B establish a comprehensive framework specifying policies and other matters requiring Board approval, review, information or delegation through prescribed appendices, while permitting delegation of policy reviews to Board Committees subject to Board approval of material amendments. The amendments also reinforce key governance principles by affirming the Board’s ultimate responsibility for strategy, financial soundness, governance, risk management and compliance, assigning the Chairperson primary responsibility for agenda setting, requiring Boards to define management information needs, and mandating periodic reviews of matters placed before the Board and those delegated to Board or Management Committees to ensure effective governance and informed decision-making.