Summary: The Reserve Bank of India (RBI) has issued RBI/2026-27/246, DOR.SOG(SPE).REC.213/13.03.00/2026-27 dated August 25, 2026, titled Reserve Bank of India (Regional Rural Banks – Interest Rate on Deposits) Third Amendment Directions, 2026. The Amendment Directions modify the Reserve Bank of India (Regional Rural Banks – Interest Rate on Deposits) Directions, 2025, dated November 28, 2025 and updated as on June 17, 2026. The 2025 Directions govern interest rates on deposits accepted by Regional Rural Banks, including NRE/NRO deposits and FCNR(B) deposits.
The present amendment concerns a temporary relaxation introduced with effect from June 17, 2026. The relaxation provided for the temporary withdrawal of the interest rate ceiling on fresh FCNR(B) deposits having three-to-five-year tenors and the restriction on interest rates on NRE deposits having three-year and above tenors, including deposits renewed upon maturity. The temporary relaxation was originally specified to operate until September 30, 2026. The RBI has, on review, decided to bring forward the end date to August 31, 2026. The earlier June 17, 2026 amendment had specifically modified paragraph 26(4), concerning NRE/NRO deposits, and paragraph 31(7), concerning FCNR(B) deposits, to provide the temporary relaxation.
Accordingly, the Third Amendment Directions substitute the phrase “with effect from June 17, 2026, for the period until September 30, 2026” with “with effect from June 17, 2026, for the period until August 31, 2026” in paragraph 26(4) subscript (1) and paragraph 31(7) subscript (2). The Amendment Directions are issued in exercise of powers conferred by Section 35A of the Banking Regulation Act, 1949 and come into force with immediate effect. The practical effect expressly stated in the supplied material is that the specified temporary relaxation will operate only until August 31, 2026 rather than September 30, 2026.
Reserve Bank of India
RBI/2026-27/246DOR.SOG(SPE).REC.213/13.03.00/2026-27 | Dated: August 25, 2026
Reserve Bank of India (Regional Rural Banks – Interest Rate on Deposits) Third Amendment Directions, 2026
Please refer to the Reserve Bank of India (Regional Rural Banks – Interest Rate on Deposits) Directions, 2025 (hereinafter referred to as ‘Directions’), dated November 28, 2025 (Updated as on June 17, 2026), wherein temporary withdrawal of the 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, have been provided with effect from June 17, 2026, for the period until September 30, 2026. On a review, it has been decided to amend the date ‘September 30, 2026’ to the date ‘August 31, 2026’ for the aforementioned temporary relaxation.
2. Accordingly, in exercise of the powers conferred by Section 35A 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.
3. These Amendment Directions shall be called the Reserve Bank of India (Regional Rural Banks – Interest Rate on Deposits) Third Amendment Directions, 2026.
4. These Amendment Directions shall come into force with immediate effect.
5. These Amendment Directions shall modify the Directions, as under:
- In paragraph 26(4) subscript (1), the phrase “with effect from June 17, 2026, for the period until September 30, 2026” shall be substituted with “with effect from June 17, 2026, for the period until August 31, 2026”.
- In paragraph 31(7) subscript (2), the phrase “with effect from June 17, 2026, for the period until September 30, 2026” shall be substituted with “with effect from June 17, 2026, for the period until August 31, 2026”.
(Dr. Sudarsana Sahoo)Chief General Manager
