- The Reserve Bank of India (RBI) tightened disclosure norms for deposit interest rates while giving banks greater flexibility to price such deposits based on liquidity risks, after HDFC Bank faced questions over bulk deposit pricing in the Maharashtra State Road Development Corporation (MSRDC) case.
- Interest rates on deposits, including bulk deposits, should be uniform across all branches and customers, with no discrimination between similar deposits accepted on the same date.
- Under the revised rules, banks must publish rates for all deposits, including bulk deposits, on their websites in advance; bulk deposit rates must be displayed every business day by 10AM, with a maximum grace period until 10.10AM.
- A bank may offer differential bulk deposit rates by considering the differential run-off rate under the LCR (liquidity coverage ratio) framework in the RBI (Commercial Banks – Asset Liability Management) Directions, 2025; this applies to rupee deposits of non-residents, and the current run-off rate is 12.5%, including 2.5% of deposits raised through digital channels.
- The latest RBI move makes it harder for banks to negotiate rates for select clients without publicly reflecting them in published schedules; daily disclosures create a benchmark for scrutiny, and banks can now distinguish wholesale deposit categories by stability.
- Banking sources said the RBI is seeking greater transparency and consistency in deposit pricing as different negotiated rates could undermine fairness and market discipline; at the same time, it recognises banks need flexibility to reflect genuine liquidity costs. Banks will have to finalise bulk deposit rates before the start of business each day, ensure timely publication on their websites and maintain consistency across branches.
The Reserve Bank of India (RBI) has introduced stricter transparency norms for bulk deposit rates, effective October 1, 2026, amid rising scrutiny of banking practices. The new guidelines require banks to publish interest rates for all deposits on their websites daily by 10 AM, ensuring uniformity across branches.1
The RBI's move follows concerns over HDFC Bank's deposit practices, particularly regarding a reported internal investigation into interest payments of ₹45 crore linked to the Maharashtra State Road Development Corporation (MSRDC). The central bank aims to enhance transparency and consistency in deposit pricing, as varying negotiated rates could undermine market discipline.
Under the revised rules, banks can offer differential interest rates on bulk deposits based on liquidity coverage ratio (LCR) considerations, allowing them to reflect genuine liquidity costs while competing for large deposits. The current run-off rate is set at 12.5%, including 2.5% from digital channels.56
The RBI's guidelines mandate that banks finalize bulk deposit rates before business hours each day, creating a transparent benchmark for regulators, auditors, and depositors to scrutinize pricing practices. This shift is expected to foster fairness in the banking sector and enhance depositor confidence.
The RBI's latest directive underscores its commitment to ensuring that deposit pricing is both transparent and equitable, addressing concerns raised by recent banking controversies.
“The revised rules require banks to publish bulk deposit rates by 10AM each business day and maintain uniform rates for similar deposits accepted on the same date. The move follows an Indian Express report that HDFC Bank probed ₹45 crore in interest payments 'camouflaged' as marketing expenditure to MSRDC for 2023-24 and 2024-25.”
The Indian Express
