The Reserve Bank of India (RBI) has introduced comprehensive changes to the rules governing interest rates on Fixed Deposits, with the new norms taking effect from October 1, 2026. According to reports from Zee News, these reforms apply to all Commercial Banks, Small Finance Banks, Regional Rural Banks, Local Area Banks, Payment Banks and Urban Cooperative Banks. The overhaul aims to bring uniformity and transparency for customers while ensuring some flexibility for banks in managing liquidity through bulk deposits.
Banks are implementing strategic delays in bulk deposit rate disclosures to prevent competitor advantages under the new RBI rules. As reported by The Hindu BusinessLine, banks are likely to utilize the 10-minute grace period after the RBI's 10 am deadline and upload their bulk deposit rates by 10.10 am to avoid giving rivals unfair advantages. Bankers fear that quoting rates at 10 am sharp would allow competitors to quote 5-10 basis points higher interest rates on bulk deposits and attract prospective customers. According to the Reserve Bank of India (Commercial Banks – Interest Rate on Deposits) Second Amendment Directions, 2026, interest rates payable on bulk deposits shall be disclosed on the bank's website at 10:00 am with a grace time of 10 minutes, latest by 10:10 am, on each business day.
Under the new regulations, banks across all branches must provide the same rate of interest on deposits of the same amount made on the same day. As reported by Zee News, this ensures that no customer in any part of the country faces discrimination by banks in terms of the rates offered. The rule applies such that if customers deposit the same amount on the same date in two different branches of the same bank, neither receives an advantage over the other, and all are treated equally.
The reforms mandate that interest rates applicable on all deposits, including bulk deposits, must be disclosed by banks in advance to offer consistency to customers and help them make better decisions. According to The Hindu BusinessLine, the new rules require that interest rates payable on deposits, including bulk deposits, will be strictly as per the schedule of interest rates disclosed in advance on the bank's website. For bulk deposits, banks are required to publish the interest rates on the website at 10:00 am, with a grace period of 10 minutes, every business day. This transparency measure allows customers to better understand their options and make informed decisions.
In the case of bulk deposits of ₹3 crore and more, RBI has offered greater flexibility to banks in deciding differential interest rates for deposits based on the run-off rate. Under the Liquidity Coverage Ratio (LCR) framework, banks can offer different interest rates on bulk deposits depending on the liquidity risk assessment. According to The Hindu BusinessLine, funding from non-financial entities such as trusts, Association of Persons (AoPs), partnerships, proprietorships, Limited Liability Partnerships and other incorporated entities will be categorized as funding from 'non-financial corporates' and attract a run-off rate of 40 per cent. In contrast, funding from corporates and other funding from banks/insurance companies & financial institutions attract a run-off rate of 100 per cent, allowing banks to offer higher interest rates on bulk deposits from non-financial entities as their run-off rate is lower.
