The Reserve Bank of India has issued a fresh UAPA terrorist organisation alert, directing all regulated entities to comply with the latest Ministry of Home Affairs notification. The MHA, on September 16, 2026, officially designated the Shahzad Bhatti Network (SBN) as a terrorist organisation. It has been listed in the First Schedule of the Unlawful Activities (Prevention) Act, 1967, under Statutory Order 5080(E).
Key Details of the UAPA Terrorist Organisation Alert
Banks and financial institutions must now treat the Shahzad Bhatti Network as a designated terrorist organisation. This designation falls under clause (a) of sub-section (1) of Section 35 of UAPA, 1967. Therefore, all regulated entities must immediately review their customer databases for any matching accounts or transactions.
The RBI circular, numbered DOR.AML.REC.233/14.06.001/2026-27 and dated September 24, 2026, covers a wide range of institutions. These include commercial banks, small finance banks, payment banks, urban and rural co-operative banks, regional rural banks, NBFCs, and all India financial institutions. Additionally, asset reconstruction companies must also comply with this directive.
What This Means for Banks and Customers
Regulated entities must strictly follow the procedure outlined in the UAPA Order dated February 2, 2021. This order forms Annex I of the RBI’s Know Your Customer Directions, 2025. As a result, any account resembling the listed entity must be reported promptly to the Financial Intelligence Unit-India (FIU-IND).
Furthermore, institutions must also inform the Ministry of Home Affairs, as required under the February 2021 UAPA notification. The RBI has reiterated that the UAPA Order applies to all amendments made to both Schedule I and Schedule IV of the Act. This includes updates beyond the standard UNSC lists mentioned in the original order.
Meanwhile, banks should establish internal monitoring processes for any future amendments to Schedule I of UAPA, 1967. The RBI expects immediate compliance whenever new designations are gazetted. However, institutions that fail to act swiftly may face regulatory scrutiny. Customers with legitimate accounts should not experience disruption, as compliance checks target only flagged entities.
For more details, refer to the official RBI notification.
Source: RBI Notifications
