Reserve Bank of India (Rural Co-operative Banks – Interest Rate on Deposits) Amendment Directions, 2026
RBI notification RBI/2026-27/143 · 17 Jun 2026
RBI notification RBI/2026-27/143 · 17 Jun 2026
Summary
Check the official recordThe Reserve Bank of India amends interest rate directions for Rural Co-operative Banks. The authority temporarily removes the interest rate ceiling on fresh FCNR(B) deposits with tenors of three to five years. It also removes the restriction on interest rates for NRE deposits with tenors of three years and above. This exemption applies to new deposits and deposits renewed upon maturity. These changes take effect on June 17, 2026, and remain in force until September 30, 2026. Transfers from NRO accounts to NRE accounts do not qualify for the NRE deposit interest rate exemption.
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RBI/2026-27/143 DOR.SOG(SPE).REC.122/13.03.00/2026-27 June 17, 2026
Reserve Bank of India (Rural Co-operative Banks – Interest Rate on Deposits) Amendment Directions, 2026
Please refer to the Reserve Bank of India (Rural Co-operative Banks – Interest Rate on Deposits) Directions, 2025 (hereinafter referred to as ‘Directions’), dated November 28, 2025. On a review, it has been decided to temporarily withdraw interest rate ceiling on fresh FCNR(B) deposits of 3-5 year tenors and restriction on interest rates on NRE deposits of 3 year and above tenors, including the deposits that are renewed upon maturity, from the date of this Amendment Directions till September 30, 2026.
Accordingly, in exercise of the powers conferred by Section 35A read with Section 56 of the Banking Regulation Act,1949 and all other laws enabling the Reserve Bank India (RBI) in this regard, the RBI, being satisfied that it is necessary and expedient in public interest so to do, hereby, issues the Amendment Directions hereinafter specified.
These Amendment Directions shall be called the Reserve Bank of India (Rural Co-operative Banks – Interest Rate on Deposits) Amendment Directions, 2026.
These Amendment Directions shall come into effect from the date of issue.
These Amendment Directions shall modify the Directions, as under:
(1) In Chapter IV on Rupee Deposits of Non-Residents, the paragraph 24(4) shall be amended as under:
Interest rates on NRE / NRO deposits shall not be higher than those offered by the bank on comparable domestic rupee term deposits ^1.
(2) In Chapter V on Foreign Currency Deposits, the paragraph 29(7) shall be amended as under:
| Period of Deposit | Ceiling Rate |
|---|---|
| One year to less than three years | Overnight Alternative Reference Rate for the respective currency/ Swap plus 250 basis points |
| Three years and above upto and including five years | Overnight Alternative Reference Rate for the respective currency/ Swap plus 350 ^2 basis points |
(Dr. Sudarsana Sahoo) Chief General Manager
^1 The said restriction with respect to interest rates offered on fresh NRE deposits mobilised by banks, including the deposits that are renewed upon maturity, for three years and above tenors, is temporarily withdrawn with effect from June 17, 2026, for the period until September 30, 2026. Any transfer from NRO accounts to NRE accounts shall not qualify for such exemption.
^2 The interest rate ceiling applicable to fresh FCNR(B) deposits mobilised by banks, including the deposits that are renewed upon maturity, for three years and above-upto and including five years tenors, is temporarily withdrawn with effect from June 17, 2026, for the period until September 30, 2026.