New RBI and UPI rules effective October

• RBI mandates daily interest rate disclosure for bulk deposits
• A 0.4% MDR applies to UPI merchant payments above Rs 2,000
• Small savings scheme interest rates remain unchanged for Q3

The start of a new quarter often brings financial rule changes. This October is no different, with key updates affecting how you save, spend, and invest. Here is a clear breakdown of what has changed and how it might impact your personal finances.

RBI: New Rules for Deposits and Forex

The Reserve Bank of India has introduced several changes effective October 1. One key update is aimed at bringing more transparency to how banks handle bulk fixed deposits of ₹3 crore and above. Banks must now disclose the interest rates for these large deposits in advance and publish them daily. While this primarily affects high-net-worth individuals and businesses, it signals a move towards greater transparency for all depositors. Another significant change from the RBI involves foreign exchange. Under amended FEMA regulations, the timeline for exporters to realise and bring back their export earnings has been shortened from 15 months to nine months. This move aims to improve foreign exchange inflows. Additionally, authorised dealer banks have been given more power to handle certain legacy trade transactions without needing direct RBI approval, which should speed up processes for businesses engaged in international trade.

UPI: Merchant Charges Introduced

The Unified Payments Interface (UPI) sees a significant shift from October 15, with the introduction of a Merchant Discount Rate (MDR) on some transactions. It is crucial to understand that this is not a charge on customers. Person-to-person money transfers remain completely free. The new rule applies a 0.4% MDR on person-to-merchant payments exceeding ₹2,000. This fee is paid by the merchant to their bank and payment service provider, not by the consumer making the payment. Transactions up to ₹2,000, which make up the vast majority of UPI payments, will remain free of this charge. The move is intended to create a sustainable revenue model for the payment ecosystem. Certain essential services like railways, fuel, and telecom will have a lower flat fee instead of the percentage-based charge. Importantly, recurring payments like SIPs and OTT subscriptions are exempt from this new MDR.

Small Savings: Interest Rates Remain Unchanged

For those invested in government-backed small savings schemes, the third quarter of the financial year brings stability. The Ministry of Finance announced that interest rates for the October to December 2026 period will remain unchanged from the previous quarter. This means the Public Provident Fund (PPF) will continue to offer an interest rate of 7.1%, while the National Savings Certificate (NSC) will hold at 7.7%. The schemes offering the highest returns, the Senior Citizen Savings Scheme (SCSS) and the Sukanya Samriddhi Yojana (SSY), will both continue to provide an interest rate of 8.2%. The decision to keep rates steady provides predictability for millions of small savers who rely on these instruments for long-term goals and regular income.

Other Key Financial Updates

Beyond these headline changes, a few other new rules have also come into effect. Some State Bank of India (SBI) account holders will see a revision in their free ATM transaction limits. Specifically, charges for Basic Savings Bank Deposit (BSBD) account holders will apply after four free cash withdrawals per month. Additionally, the Pension Fund Regulatory and Development Authority (PFRDA) has introduced a revised charge structure for the National Pension System (NPS) from October 1. These adjustments, while smaller in scope, are part of the broader set of financial modifications taking place this month that are worth being aware of to manage your money effectively.