The Reserve Bank of India (RBI), on November 28, 2025, issued the Reserve Bank of India (Commercial Banks – Interest Rate on Deposits) Directions, 2025 to provide a unified and transparent regulatory framework governing interest rates on domestic rupee deposits, non-resident rupee deposits, and foreign currency deposits. These Directions apply to all commercial banks except SFBs, PBs, RRBs and LABs, and set out rules for current, savings, and term deposits; overdraft-linked deposits; premature withdrawal penalties; interest treatment on deceased depositors’ accounts; and special deposit categories such as composite cash credit accounts of farmers.
The Directions establish the interest-rate framework for domestic rupee deposits, covering current accounts (non-interest bearing), savings accounts (interest on daily product basis at bank-determined rates), domestic term deposits (fixed/floating interest, renewals, overdue deposit interest), reinvestment deposits, bulk deposits, and penalties for premature withdrawal. They also specify requirements for overdraft-linked deposits, the periodicity of savings interest payments, and special rules for interest on deposits of deceased customers.
The Directions further govern interest on non-resident rupee deposits (NRE/NRO), foreign currency deposits under the FCNR(B) scheme, RFC accounts, conversion of FCNR(B) accounts upon return to India, and treatment of premature withdrawal and penalties. Prohibitions (such as paying interest beyond permitted norms) and exemptions are specified, along with repeal, saving and interpretational clauses.
[Notification No. RBI/DOR/2025-26/153]
