RBI revises deposit interest rules to boost transparency, uniformity; new norms effective October 1

The RBI has revised the regulatory framework for deposit interest rates, requiring banks to disclose rates in advance and maintain uniform rates across branches. Effective October 1, the new norms aim to enhance transparency while retaining flexibility in pricing bulk deposits

Mumbai: The Reserve Bank of India (RBI) has revised the regulatory framework governing deposit interest rates, introducing measures aimed at enhancing transparency and ensuring uniform treatment of depositors across banks.

The new rules, notified on Friday, will come into effect from October 1.

---

The revised directions will apply to commercial banks, small finance banks, regional rural banks (RRBs), local area banks, payments banks and urban cooperative banks.

Under the new framework, banks will be required to disclose the interest rates applicable on all deposits, including bulk deposits, in advance on their websites.

For bulk deposits, banks must publish the applicable interest rates by 10:00 am on every business day, with a maximum grace period of 10 minutes, ensuring the rates are available no later than 10:10 am.

The RBI has also mandated that deposit interest rates must be uniform across all branches of a bank and for all customers.

Banks will not be allowed to discriminate between depositors by offering different interest rates on deposits of the same amount accepted on the same date at different branches.

At the same time, the central bank has retained flexibility for lenders in pricing bulk deposits.

Banks will be permitted to offer differential interest rates on bulk deposits after taking into account the rates applicable to deposits or unsecured wholesale funding under the Liquidity Coverage Ratio (LCR) framework, as outlined in the Reserve Bank of India (Commercial Banks – Asset Liability Management) Directions, 2025.

The revised guidelines, however, do not prescribe any increase or reduction in fixed deposit (FD) interest rates from October 1.

Deposit rates will continue to be determined by individual banks based on factors such as liquidity conditions, funding requirements and prevailing market dynamics.

While the changes are not expected to trigger immediate changes in retail fixed deposit rates, they are likely to improve transparency in the way banks disclose deposit rates and provide lenders with greater operational flexibility in managing bulk deposits.