RBI Invites Comments on Draft Amendment Directions Reviewing IFR Norms

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  • Last Updated on 12 April, 2026

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RBI IFR draft directions

Press Release: 2026-2027/44, Dated 08.04.2026

The Reserve Bank of India (RBI) has issued draft Amendment Directions to review the existing framework governing the Investment Fluctuation Reserve (IFR) for various categories of banks.

1. Objective of the Draft Amendment

The proposal aims to:

  • Rationalise and harmonise IFR-related instructions across bank categories
  • Align prudential norms with market risk frameworks
  • Simplify compliance requirements

2. Key Proposed Changes

2.1 Dispensing with IFR Requirement

  • The draft proposes to remove the requirement of maintaining IFR for banks that already maintain a capital charge for market risk

This avoids duplication of prudential buffers.

2.2 Compliance at Balance Sheet Dates

  • Banks may be allowed to ensure compliance with IFR requirements at balance sheet dates
  • This reduces the need for continuous maintenance, easing operational burden

2.3 Harmonisation Across Bank Categories

The draft seeks to:

    • Standardise IFR instructions across different categories of banks
    • Eliminate inconsistencies in current guidelines

3. Public Consultation

  • RBI has invited comments from stakeholders
  • Feedback can be submitted under the ‘Connect 2 Regulate’ framework
  • The last date for submission is 29th April 2026

4. Conclusion

The draft directions reflect RBI’s intent to streamline prudential norms, reduce regulatory overlap, and create a more coherent and efficient framework for managing investment-related risks in banks.

Click Here To Read The Full Press Release

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Author: Taxmann

Taxmann Publications has a dedicated in-house Research & Editorial Team. This team consists of a team of Chartered Accountants, Company Secretaries, and Lawyers. This team works under the guidance and supervision of editor-in-chief Mr Rakesh Bhargava.

The Research and Editorial Team is responsible for developing reliable and accurate content for the readers. The team follows the six-sigma approach to achieve the benchmark of zero error in its publications and research platforms. The team ensures that the following publication guidelines are thoroughly followed while developing the content:

  • The statutory material is obtained only from the authorized and reliable sources
  • All the latest developments in the judicial and legislative fields are covered
  • Prepare the analytical write-ups on current, controversial, and important issues to help the readers to understand the concept and its implications
  • Every content published by Taxmann is complete, accurate and lucid
  • All evidence-based statements are supported with proper reference to Section, Circular No., Notification No. or citations
  • The golden rules of grammar, style and consistency are thoroughly followed
  • Font and size that's easy to read and remain consistent across all imprint and digital publications are applied