RBI Revises Deposit Interest Rate Rules from 1 October

• Kashish Kumar
• 03 Aug 2026
• 11 Views

The rules that govern how banks offer and disclose deposit interest rates have been overhauled by the Reserve Bank of India (RBI). According to RBI press release dated 30 July 2026, the revised framework of central bank is set to come into effect from 1 October this year.

The changes are not expected to affect returns on retail fixed deposits overnight. However, they are expected to make FD pricing more transparent for customers as well as give banks more flexibility in setting rates for bulk deposits.

How Will New RBI Rules Affect Retail FD Investors?

The biggest change for retail depositors is greater transparency and uniformity in how deposit rates are offered. As per the revised directions, banks will have to offer same rate of interest across all branches for deposits of similar amount accepted on the same day. That is to say, customers opening identical deposits at different branches of the same bank cannot be offered different rates.

Furthermore, the RBI has tightened the disclosure norms. Banks will need to publish their schedule of interest rates on deposits on their websites in advance and the interest paid on deposits will have to be strictly in accordance with the published schedule.

Banks have been asked by the central bank to put the relevant interest rates for bulk deposits on their websites by 10:00 am on each business day. There is a grace period till 10:10 am. It is anticipated that the changes will make it easier for customers to compare deposit rates before investing and reduce chances of branch level variations for similar deposits. 

Bulk Deposits Under Revised RBI Rules 

For the banks, the policy change is more significant than for the retail depositors. The RBI has authorised banks to provide differential interest rates on bulk deposits by taking into account the varied run-off rates applicable under Liquidity Coverage Ratio framework. Non-residents rupee deposits are now subject to the same flexibility.

The RBI states that the goal is to ensure more uniformity and transparency in the disclosure of deposit interest rates while allowing banks more freedom in pricing rupee bulk deposits. 

Who Will the Changes Apply To?

According to RBI press release dated 30 July 2026, the changes will apply to following categories of banks:-

• Commercial Banks

• Small Finance Banks 

• Regional Rural Banks 

• Local Area Banks 

• Payment Banks

• Urban Co-operative Banks 

To implement revised framework, the RBI has issued following amendment directions w.e.f. October 1, 2026:-

• Reserve Bank of India (Commercial Banks - Interest Rate on Deposits) Second Amendment Directions, 2026

• Reserve Bank of India (Small Finance Banks - Interest Rate on Deposits) Second Amendment Directions, 2026

• Reserve Bank of India (Regional Rural Banks - Interest Rate on Deposits) Second Amendment Directions, 2026

• Reserve Bank of India (Payment Banks - Interest Rate on Deposits) Amendment Directions, 2026

• Reserve Bank of India (Local Area Banks - Interest Rate on Deposits) Second Amendment Directions, 2026

• Reserve Bank of India (Urban Co-operative Banks - Interest Rate on Deposits) Second Amendment Directions, 2026

Are FD Interest Rates Set to Change Under New Rules? 

No. This is not necessarily the case. The RBI's revised framework does not require banks to either increase or reduce their fixed deposit interest rates. Banks will continue to decide their deposit rates on the basis of factors like liquidity requirements, funding costs and market conditions to name a few. The new rules mainly prioritize how banks disclose their deposit interest rates as well as how exactly they price bulk deposits. 

The rules do not prescribe or regulate interest rates offered on retail fixed deposits. The revised framework is based on a draft proposal released by RBI in June 2026. This proposal invited comments from banks as well as other stakeholders. After reviewing the feedback, the central bank issued final directions. It later postponed their implementation until October 1 so as to give banks additional time to comply.

Source: Livemint