The Reserve Bank of India has published the Third Amendment Directions for Regional Rural Banks regarding interest rates on deposits. The amendment temporarily lifts the interest rate cap on new FCNR(B) deposits.
RBI Issues Third Amendment Directions for Regional Rural Banks
On August 25, 2026, the Reserve Bank of India (RBI) released the Third Amendment Directions (RBI/2026-27/246) related to interest rates on deposits for Regional Rural Banks.
This decision updates the previous Directions from November 28, 2025, revised on June 17, 2026, and notably removes the interest rate ceiling on new FCNR(B) deposits for a limited time.
By allowing more flexibility in deposit rates, the RBI aims to enhance the ability of Regional Rural Banks to attract and retain deposits in a competitive banking environment.
Banking professionals should be aware of these amendments as they may significantly affect deposit policies and interactions with clients seeking foreign currency deposits.
Citations
- RBI/2026-27/246 Reserve Bank of India