4 min readUpdated: Jul 31, 2026 02:43 PM IST
The Reserve Bank of India (RBI) has tightened disclosure norms for deposit interest rates while simultaneously giving banks greater flexibility to price such deposits based on liquidity risks, a move that comes on the heels of HDFC Bank facing questions over the pricing of bulk deposits in the Maharashtra State Road Development Corporation (MSRDC) case.
The interest rates offered on deposits, including bulk deposits, should be uniform across all branches and for all customers and there should be no discrimination in the matter of interest paid on the deposits, between one deposit and another deposit of similar amount, accepted on the same date, at any of its offices, the RBI said while amending the guidelines.
Under the revised rules, banks will now be required to publish interest rates applicable to all deposits, including bulk deposits, on their websites in advance.
More importantly, interest rates for bulk deposits must be displayed every business day by 10AM, with a maximum grace period until 10.10AM, the RBI said.
The exception
However, a bank will have the freedom to offer differential interest rate on bulk deposits, by considering the differential run-off rate applicable to deposits or unsecured wholesale funding under the LCR (liquidity coverage ratio) framework, as specified in the Reserve Bank of India (Commercial Banks – Asset Liability Management) Directions, 2025, the RBI said. This will be applicable on rupee deposits of non-residents as well.
If a liquidity crisis occurs, run-off rate is the proportion of the fund/ deposits likely to leave the bank. The bank must hold enough High Quality Liquid Assets (HQLA) like cash held, government bonds and central bank reserves, to cover such stressed outflows.
The current run-off rate is 12.5%, including 2.5% of the deposits raised through digital channels. Higher run-off rates increase the bank’s expected cash outflows, reduce the LCR (liquidity coverage ratio) ratio and require the bank to hold more liquid assets.
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LCR indicates whether a bank has enough high-quality liquid assets.
The central bank on Thursday issued the Reserve Bank of India (Commercial Banks- Interest Rate on Deposits) Second Amendment Directions, 2026, which will come into effect from October 1, 2026.
On May 27, The Indian Express reported that the private sector lender had conducted an internal vigilance investigation into interest payments of
Rs 45 crore, “camouflaged” as marketing expenditure, made to MSRDC for 2023-24 and 2024-25.
The report further pointed that the internal investigation was ordered on March 12 by the Audit Committee of the board, just six days before Atanu Chakraborty abruptly resigned as the bank’s part-time chairman, saying “certain happenings and practices within the bank are not in congruence with my personal values and ethics”.
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The internal audit of the bank’s marketing department had flagged these payments and rated the department’s performance as “unsatisfactory”, investigation by The Indian Express showed.
These payments were disguised as contributions to a road safety awareness campaign through local vendors.
The latest RBI move is likely to make it harder for banks to negotiate rates for select clients without publicly reflecting those rates in their published schedules.
The requirement for daily disclosures creates a transparent benchmark against which deposit pricing can be scrutinised by regulators, auditors and depositors.
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Banks can now distinguish between categories of wholesale deposits based on how sticky or stable they are from a liquidity management perspective.
Deposits that attract higher regulatory run-off rates under the LCR framework may be priced differently from deposits viewed as more stable.
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 that banks need flexibility to reflect genuine liquidity costs while competing for large deposits.
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.