The Reserve Bank of India has proposed a harmonized, principles-based framework for determining interest rates on fixed and floating rate loans across all regulated entities. The framework would be proportionate to each entity’s nature, complexity and scale, broadening the current approach beyond commercial banks and conduct-related requirements for other lenders. The proposal responds to divergent commercial bank practices in determining the marginal cost of funds-based lending rate and its components, as well as limited existing rules for fixed rate loans. It would cover commercial banks, non-banking financial companies, all-India financial institutions, regional rural banks, urban cooperative banks and rural cooperative banks. Comments are due by Sept. 11, 2026. After reviewing feedback, the RBI will issue final directions separately for each category of regulated entity.
Reserve Bank of India2026-08-12
Reserve Bank of India launches consultation on harmonized interest rate rules for fixed and floating rate loans
The Reserve Bank of India is consulting on harmonized, principles-based interest rate rules for fixed and floating rate loans across all regulated entities. The proposal addresses divergent benchmark practices and limited fixed rate loan requirements. Comments are due by Sept. 11, 2026, after which final directions will be issued separately for each category of entity.