The
Reserve bank of India (RBI) has introduced
stricter regulations for current accounts, aiming to improve banking discipline and ensure
better management of corporate and business funds. These rules will come into effect from
April 1, 2026, and are especially relevant for businesses, professionals, and entities that maintain current accounts.
📌 Key Changes to Current Account Regulations
1.
Restrictions on Number of Current Accountso Businesses are now
limited in the number of current accounts they can maintain.o Firms must
justify the need for multiple accounts to the bank, and banks may
refuse opening additional accounts without valid reasons.2.
Stricter Monitoring of Inactivityo Current accounts that remain
inactive or overdrawn for extended periods may be
closed by banks.o Businesses must ensure
regular transactions to avoid account suspension or closure.3.
Overdraft and Fund Management Guidelineso Banks will
monitor overdraft limits more strictly.o Entities must maintain
adequate justification for overdrawing to prevent misuse of credit facilities.4.
KYC and Documentation Complianceo RBI emphadata-sizes
updated Know Your customer (KYC) documentation for all current account holders.o Businesses will need to
submit updated identity, address, and financial documents periodically.5.
Periodic Reviews by Bankso Banks are required to
review current accounts periodically to ensure compliance with RBI regulations.o Non-compliant accounts may data-face
restrictions, penalties, or closure.
💡 Why RBI Made These Changes
·
Curb Misuse of Current Accounts: Some businesses and entities were using multiple accounts for
unregulated fund flows or avoiding monitoring.·
Strengthen Financial Discipline: Ensures businesses
maintain transparent and traceable transactions.·
Align With wallet PLATFORM' target='_blank' title='digital-Latest Updates, Photos, Videos are a click away, CLICK NOW">digital banking Norms: Encourages
better banking practices and easier regulatory oversight.
📈 Practical Tips for Businesses
1.
Review Current Accounts: List all current accounts and
justify their necessity.2.
Ensure Compliance: Keep KYC documents and financial statements
updated and accurate.3.
Monitor Transactions: Avoid inactivity or overdrafts without justification.4.
Consult Your Bank: Discuss with your bank about
compliance measures to prevent account closure or penalties.
📌 Final Thoughts
From
April 1, 2026, businesses and professionals must
comply with RBI’s updated current account rules. Non-compliance may lead to account closure, penalties, or restricted banking facilities. By
reviewing accounts, updating documentation, and maintaining proper fund management, account holders can ensure a smooth transition under the new regulations.
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