The Reserve Bank of India (RBI), on January 06, 2026, invited public comments on the draft “Reserve Bank of India (Prudential Norms on Dividend and Remittance of Profit) Directions, 2026”, following a comprehensive review of the existing prudential framework governing declaration of dividends and remittance of profits by banks. The review builds upon an earlier draft framework issued on January 2, 2024, and incorporates stakeholder feedback and regulatory consultations.
Based on the review, RBI has proposed a revised methodology for computing the maximum eligible dividend payout and released draft Directions applicable to different categories of banks, including Commercial Banks (covering foreign banks operating in branch mode), Small Finance Banks, Payment Banks, Regional Rural Banks, and Local Area Banks. The proposed Directions aim to strengthen prudential oversight while ensuring consistency and clarity in dividend distribution norms across the banking sector.
Stakeholders have been invited to submit their comments and feedback on the draft Directions by February 5, 2026, through the ‘Connect2Regulate’ section of the RBI website or by post/email to the Department of Regulation, Reserve Bank of India. The feedback received will be considered before finalising the Directions.
[Notification No. Press Release: 2025-2026/1866]
