FD Rules: Big news for FD investors. If you have invested in fixed deposits (FDs), the upcoming changes effective from October 1, 2026, are crucial for you. The Reserve Bank of India (RBI) has introduced fresh directives for banks concerning FD interest rates. These guidelines aim to eliminate customer confusion about rates across various branches and enhance transparency within the banking sector. However, this does not imply that FD interest rates will directly rise or fall starting October 1.
According to the new regulation, if an FD is initiated on the same day, for the same amount, and for the same duration, different branches of the same bank cannot offer varying interest rates. Therefore, if a customer opens an FD for the same amount and duration at two different branches of the same bank, the interest rate should be identical at both locations. This will minimize the chances of customers receiving different rates based on the branch or negotiations.
Interest rates must be disclosed in advance on the bank’s website. The updated RBI rules mandate banks to provide information on interest rates on their official websites in advance. This will enable customers to check the applicable interest rates online before proceeding with an FD, reducing the necessity to visit a bank branch for rate inquiries or rely solely on staff information. The rates displayed on the website will act as a crucial point of reference for customers.
New regulations for FDs exceeding Rs 3 crore. Deposits of Rs 3 crore or more are classified as bulk deposits. Banks need to publish the relevant interest rates for such substantial deposits on their websites daily by 10:00 a.m., with a grace period until 10:10 a.m. However, banks have the flexibility to set different interest rates for various bulk deposits based on liquidity risks.
What happens to existing FDs? If you have an FD created before October 1, 2026, the new rule will not alter its fixed interest rate. The FD will continue to accumulate interest as per the predetermined terms until maturity. Moreover, the new rule does not signify a universal increase or decrease in interest rates for all FDs from October 1. Banks will determine interest rates considering their cost of funds and prevailing market conditions.
Which banks does the rule cover? These guidelines are applicable to all banks, encompassing commercial banks, small finance banks, regional rural banks (RRBs), local area banks, payments banks, and urban cooperative banks. Hence, before initiating an FD, it is advisable to verify the applicable interest rate, term, and other conditions on the bank’s official website.