Economic Capital Framework (ECF) and the Bimal Jalan Committee
The Economic Capital Framework is the methodology the RBI uses to determine its appropriate capital level (risk buffers) and, by residual, the surplus available for transfer to the government. The original ECF was formulated in 2019 based on recommendations of the Expert Committee chaired by former RBI Governor Bimal Jalan.
- The Bimal Jalan Committee (2018–19) recommended that the RBI maintain a Contingency Risk Buffer (CRB) of 5.5–6.5% of its balance sheet as protection against monetary, financial, and systemic risks.
- The ECF revised in May 2025 widened the CRB band to 4.5–7.5%, giving the Central Board more discretion to vary provisioning based on prevailing economic conditions — more in uncertain times, less in stable periods.
- If the Available Realised Equity exceeds the upper CRB bound (7.5%), the excess can be written back to income and transferred; if it falls below the lower bound (4.5%), no surplus is transferred until buffers are restored.
● Tracked since May 18, 2026 · last seen May 25, 2026 · updates as the daily brief publishes
See it in today’s brief.
Daily current affairs with every static concept explained in place.
Read the daily brief