The RBI's Third Amendment Directions facilitate adjustments to interest rates on deposits for commercial banks, fostering competitive deposit offerings.
RBI Issues Third Amendment Directions for Commercial Banks
On August 25, 2026, the Reserve Bank of India published the 'RBI (Commercial Banks – Interest Rate on Deposits) Third Amendment Directions, 2026.' This amendment modifies the guidelines set forth in 2025, specifically allowing commercial banks to lift ceilings on interest rates for new deposits.
The amendment aims to provide commercial banks with the flexibility to offer competitive interest rates on FCNR(B) deposits, enhancing their position in the financial sector amidst evolving market conditions.
Legal practitioners and financial experts should consider the potential impacts of this amendment in their advisory roles. The relaxation of interest rate ceilings may encourage commercial banks to formulate new deposit strategies and engage with a broader client base.
Citations
- Reserve Bank of India (Commercial Banks – Interest Rate on Deposits) Third Amendment Directions (2026)