meta_id 3326683

On July 14, 2026, the Reserve Bank of India (RBI) issued the Reserve Bank of India (Payments Banks – Governance) Amendment Directions, 2026, which modifies the governance framework for payments banks operating in India. The amendment aims to enable bank boards to utilise their time more effectively by rationalising existing RBI directions and circulars regarding matters requiring board approval and review. The amendment introduces significant structural changes to board governance. It relocates and modifies paragraph 23 of Chapter V to become paragraph 16A, establishing explicit board oversight responsibilities over risk management systems, policies and strategies, exposures to related entities, and corporate governance standards. The RBI deleted multiple paragraphs from Chapters IV and V, streamlining procedural requirements. Chapter V's title changes from "Calendar of Reviews and Board Meeting Procedures" to "Matters to be placed before the Board." The amendment establishes a principles-based framework for board decision-making. New paragraphs 27A and 27B specify that policies requiring board approval are detailed in Appendix I, with certain approvals delegable to board committees. Matters other than policies are categorised into those requiring board approval or information (Appendix II A) and those delegable at board discretion (Appendix II B). The framework emphasises that boards retain ultimate responsibility for business strategy, financial soundness, key personnel decisions, internal organisation, governance structure, and risk management obligations. Boards may delegate certain matters to board committees with appropriate reporting requirements. The amendment requires boards to dedicate sufficient time to strategy and risk governance, ensure adequate management information flow, and periodically review delegated matters and agenda timeliness. The amendment becomes effective on October 1, 2026. Payments banks must align their governance practices with these revised directions by this date.