RBI is rolling out game-changing rules for Fixed Deposits starting from 1st January 2026. The key changes made are:
Premature FD Withdrawal Disclosure
Banks must disclose premature FD closure terms such as interest rate, penalties etc at booking time, ensuring full transparency before customers commit.
Which means-
If you close your FD before maturity then bank must tell you clearly in advance that how much penalty will be charged and for that interest you will lose. As in some situations after penalty, the final interest may be reduced.
For Example, breaking a 1-year 6% FD after 6 months might yield only 3% after a 1% penalty, potentially resulting in reduced interest.
FD Must Be For a Minimum 7-Day Tenure
No bank can offer FDs less than 7 days. Any FD with tenure below 7 days is not allowed. This rule is mandatory for all banks. Short-term funds <7 days should go into savings accounts instead.
For Example:
5-day deposit rejected for FD; use savings for <7 days. Valid FDs start at 7 days.
Extra Interest if Maturity Falls on a Holiday
If a Fixed Deposit matures on a holiday such as Sunday, public holiday, etc.), payment shifts to next working, banks must pay interest for that extra day too. This means customers will not lose any interest because of the holiday.
No Gifts or Promotions
Banks cannot offer vouchers or promotional items to attract customers to open Fixed Deposit.
Decisions should base purely on interest rates, not freebies like gold coins or appliances.
Uniform Interest Rates Across Branches
Bank must offer same FD interest rate in all branches across India for the same tenure, regardless of urban, rural, or city location.
Exceptions apply for customer categories like seniors or high-value deposits.
CAclubindia
