meta_id 3249451

On June 17, 2026, the Reserve Bank of India (RBI) issued the Reserve Bank of India (Commercial Banks – Interest Rate on Deposits) Amendment Directions, 2026, temporarily modifying restrictions on interest rates for specific deposit categories. The amendment temporarily withdraws interest rate ceilings on fresh Foreign Currency Non-Resident (FCNR(B)) deposits with tenors of three to five years. It also removes restrictions on interest rates applicable to Non-Resident External (NRE) deposits of three years and above tenors, including deposits renewed upon maturity. These exemptions remain in effect from June 17, 2026, until September 30, 2026. For FCNR(B) deposits with tenors of three years and above up to and including five years, the RBI establishes a new ceiling rate of Overnight Alternative Reference Rate for the respective currency or swap plus 350 basis points. For deposits with tenors of one year to less than three years, the ceiling remains at Overnight Alternative Reference Rate plus 250 basis points. The amendment modifies the Reserve Bank of India (Commercial Banks – Interest Rate on Deposits) Directions, 2025, issued on November 28, 2025. The RBI exercised its authority under Section 35A of the Banking Regulation Act, 1949, to issue these directions, which took effect immediately upon issuance. The temporary withdrawal applies only to fresh deposits mobilised by banks and deposits renewed upon maturity; transfers from Non-Resident Ordinary (NRO) accounts to NRE accounts do not qualify for the exemption. Commercial banks must ensure compliance with the revised interest rate parameters for affected deposit categories during the specified period.