Latest News on Reserve Bank of India
India’s foreign exchange reserves bounce back, rising $4.8 billion to $702.78 billion after last week’s decline, according to ANI News
India’s foreign exchange (forex) reserves have seen a significant rebound, increasing by $4.8 billion to reach $702.78 billion, according to recent data. This rise comes after a decline in the previous week, indicating a positive trend for the country’s forex reserves. The increase in forex reserves is a promising sign for the Indian economy, as it provides a cushion against external shocks and supports the value of the rupee.
The substantial rise in forex reserves has brought the total reserves closer to their all-time high, with the country’s overall kitty now standing at $702.78 billion. This increase is also notable when compared to Pakistan’s GDP, which is almost half of India’s forex reserves, highlighting the significant difference in the economic strength of the two neighboring countries.
The rise in forex reserves can be attributed to several factors, including a reduction in the forward book, which is the amount of currency that traders and investors have agreed to buy or sell at a future date. A leaner forward book means that there is less pressure on the rupee, making it more stable and less susceptible to fluctuations. This, in turn, bolsters the rupee shield, providing a level of protection against external economic shocks.
The $700 billion plus forex reserve pile is a significant asset for India, providing a level of comfort and stability for the economy. It also gives the country the ability to manage its external debts and meet its foreign exchange requirements. The Reserve Bank of India (RBI) has been actively managing the forex reserves, using various tools and strategies to maintain the stability of the rupee and ensure that the country’s external sector remains robust.
Overall, the increase in India’s forex reserves is a positive development for the country’s economy, providing a level of protection and stability in an uncertain global economic environment. The significant size of the forex reserve pile, combined with a leaner forward book, makes the rupee more resilient to external shocks, and provides a level of comfort for investors and traders.
State Bank of India (SBI) is likely to issue tier-II bonds worth ₹5,000 crore by August, with preliminary discussions already underway, according to a recent report.
The State Bank of India (SBI) is planning to raise ₹5,000 crore through tier-II bonds by August, according to a report. The move is part of the bank’s efforts to strengthen its capital base and meet the regulatory requirements. Tier-II bonds are a type of debt instrument that banks use to raise capital, which can be used to meet their capital adequacy requirements.
The report cites sources familiar with the development, stating that the initial level talks have already started. The bank is expected to file the necessary documents with the regulatory authorities soon. The fundraising plan is subject to market conditions and regulatory approvals.
SBI’s plan to raise capital through tier-II bonds is seen as a positive move, as it will help the bank to improve its capital adequacy ratio (CAR). The CAR is a measure of a bank’s capital strength, and it is calculated by dividing the bank’s capital by its risk-weighted assets. The Reserve Bank of India (RBI) has set a minimum CAR requirement of 11.5% for banks, and SBI’s current CAR is around 12.6%.
The fundraising plan is also expected to support SBI’s business growth plans. The bank has been expanding its loan book and has seen significant growth in its retail and corporate lending businesses. The additional capital raised through the tier-II bonds will provide the bank with the necessary resources to support its growth plans and meet the increasing demand for credit from its customers.
The report also notes that SBI is not the only bank planning to raise capital through tier-II bonds. Other public sector banks, such as Bank of Baroda and Canara Bank, are also planning to raise capital through similar instruments. The move is seen as a sign of the improving financial health of the public sector banks, which have been struggling with high levels of non-performing assets (NPAs) in recent years.
Overall, SBI’s plan to raise ₹5,000 crore through tier-II bonds is a positive development for the bank and the banking sector as a whole. It will help the bank to strengthen its capital base, support its business growth plans, and meet the regulatory requirements. The move is also expected to boost investor confidence in the bank and the sector, which has been impacted by the COVID-19 pandemic and the resulting economic slowdown.
RBI’s Rate Cuts Make Home Buying More Affordable, Reveals Latest Report | Real Estate Updates
The affordability of homebuyers in India has improved significantly in the first half of 2025, thanks to the Reserve Bank of India’s (RBI) decision to slash the repo rate by 100 basis points. According to a report by Knight Frank India, the house purchase affordability index has shown a marked improvement, with most cities becoming more affordable for homebuyers. The report highlights that Ahmedabad is the most affordable housing market among the top eight cities, with a ratio of 18%, followed by Pune and Kolkata.
Mumbai, which has traditionally been one of the least affordable cities, has seen a significant improvement in its affordability index, with the ratio decreasing from 50% in 2024 to 48% in the first half of 2025. This is the first time that Mumbai’s affordability index has fallen below the 50% mark, which is considered the outer limit of affordability. The improvement in affordability can be attributed to the reduction in home loan rates, making it easier for homebuyers to purchase properties.
However, the National Capital Region (NCR) has seen a marginal decline in affordability, with households now needing to pay 28% of their income to acquire an average property, up from 27% in 2023. This is due to the steep increase in residential prices, which has overshadowed the impact of the interest rate cuts.
The Knight Frank Affordability Index is based on the Equated Monthly Instalment (EMI) to income ratio for an average household. The report suggests that as incomes grow and the economy gains strength, financial confidence among end-users improves, motivating them to invest in home ownership. With the RBI’s healthy GDP growth estimate for FY 2026 and a favourable interest rate scenario, affordability levels are expected to support homebuyer demand in 2025.
Overall, the report notes that affordability levels are now at their best since the pandemic and are significantly better than the levels seen at the end of 2024. The improvement in affordability is expected to boost the real estate sector, with homebuyers likely to take advantage of the favourable interest rate scenario and invest in properties.
Access a Range of Small Finance Financial Institutions
AU Small Finance Bank has announced a reduction in interest rates for fixed deposits (FDs) effective from March 10, 2025. The new interest rates range from 3.75% to 8.50% per annum for general customers, while senior citizens can earn interest rates ranging from 4.25% to 8.77% per annum. The bank has reduced its FD interest rates in response to the Reserve Bank of India (RBI)’s recent decision to reduce the repo rate.
The bank’s previous FD interest rates for general customers ranged from 8.10% to 8.60%, while senior citizens could earn rates between 8.60% to 8.24%. The revised rates are effective from March 10, 2025, and are available for deposits up to Rs. 3 crore.
The reduction in interest rates is a common trend among banks, as the RBI’s repo rate cut has led to a decrease in FD interest rates. Despite this, AU Small Finance Bank is still offering competitive rates, making it a good option for those looking to invest in FDs.
Senior citizens can benefit from the higher interest rates offered by the bank, with maximum returns of 8.50% for FDs with a tenure of 18 months. The bank’s FDs also offer flexible tenures ranging from 7 days to 10 years, allowing investors to customize their investment plans according to their financial goals.
In conclusion, while the reduction in interest rates may not be ideal for FD investors, AU Small Finance Bank is still a good option for those looking to invest in FDs. The bank’s competitive rates, guaranteed returns, and flexible tenures make it a good choice for both general customers and senior citizens. It is recommended to lock in FDs before banks reduce interest rates further, and senior citizens may want to consider FDs with a tenure of 18 months for maximum returns.
The Reserve Bank of India (RBI) is now accepting applications for the recognition of Self-Regulatory Organisations (SROs) to operate in the account aggregator ecosystem, ET LegalWorld reports.
The Reserve Bank of India (RBI) has released a framework for recognizing Self-Regulatory Organizations (SROs) for the account aggregator (AA) ecosystem. The account aggregator ecosystem was introduced by the RBI in 2016 to facilitate the secure and seamless exchange of financial information between financial information providers and financial information users. The RBIAA framework operates under the purview of various financial sector regulators, including RBI, Securities and Exchange Board of India (SEBI), Insurance Regulatory and Development Authority of India (IRDAI), and the Pension Fund Regulatory and Development Authority (PFRDA), as well as the Department of Revenue.
The AA ecosystem is complex, with multiple regulated entities (REs) operating under different regulatory environments, requiring frequent coordination to address operational issues such as dispute resolution, standardized agreements, and common services. To support the adoption and stabilization of the AA ecosystem, the RBI is seeking to establish a dedicated SRO for the AA ecosystem.
The primary responsibility of the SROAA would be to promote best business practices and controls, establishing minimum benchmarks and conventions for professional market conduct among its members. The SROAA would be expected to operate with transparency, professionalism, and independence, fostering greater confidence in the integrity of the ecosystem. Compliance with the highest standards of governance, as prescribed in the Companies Act, 2013, is a prerequisite for an effective SROAA.
The RBI has invited applications for recognition of SROAA through the PRAVAAH portal, with the deadline set for June 15, 2025. The SROAA is intended to promote a smooth and stable AA ecosystem, ensuring the secure and efficient exchange of financial information among various stakeholders.
A boon for the masses, PNB joins SBI in making loans more affordable for the average citizen
Punjab National Bank (PNB), the second-largest government bank, has made borrowing more accessible by reducing interest rates on retail loans by up to 25 basis points. This move follows the Reserve Bank of India’s (RBI) recent repo rate cut. PNB has slashed rates on various loan types, including home loans, car loans, education loans, and personal loans, to offer customers a wider range of financial options.
The new interest rates are as follows: home loans begin at 8.15%, with equated monthly installments (EMIs) starting at Rs 744 per lakh. Car loans, including new and used vehicles, start at 8.50% per annum with EMIs beginning at Rs 1,240 per lakh. Additionally, PNB is offering an extra discount of 0.05% on car loans to promote sustainable mobility. Personal loans up to Rs 20 lakh can be applied for digitally, with revised interest rates starting at 11.25% per annum.
To make the process even more convenient, PNB is waiving processing fees and documentation charges until March 31, 2025. These new rates will take effect on February 10. This move is consistent with State Bank of India’s (SBI) recent decision to reduce interest rates on retail loans, including home loans, by 25 basis points. Overall, these rate cuts are expected to benefit customers and stimulate economic growth.
Canara Bank reduces lending rates on select tenures by 5-15 basis points, effective March 12, 2023.
Canara Bank, a major Indian public sector bank, has announced a reduction in lending rates on certain tenures by 5-15 basis points (bps), effective March 12, 2023. This move is aimed at boosting credit growth and supporting the economic recovery in the country.
The bank has reduced the marginal cost of lending rate (MCLR) by 15 bps, from 7.50% to 7.35%, for overnight and up to one-year tenure. For terms ranging from 1-3 years, the MCLR has been reduced by 10 bps, from 7.80% to 7.70%. For 3-5 year tenures, the MCLR has been lowered by 5 bps, from 8.20% to 8.15%.
This rate reduction is expected to make borrowing more affordable for customers, particularly for housing and personal loans. The bank’s decision is also seen as a response to the Reserve Bank of India’s (RBI) August 2022 circular, which asked banks to link their lending rates to external benchmarks, such as the RBI’s repo rate. The RBI has been lowering its repo rate to stimulate the economy, and Canara Bank’s rate cut is seen as a way to align its lending rates with the RBI’s monetary policy stance.
The rate reduction is also expected to boost business and employment in the economy by providing easier access to credit for small and medium-sized enterprises (SMEs) and individuals. SMEs are often the backbone of the economy, and access to credit can help them grow and create employment opportunities.
Canara Bank’s rate cut is seen as a positive move by financial experts, who point out that it can help accelerate economic growth and job creation. However, they also caution that more needs to be done to address structural issues affecting the banking sector, such as the high non-performing asset (NPA) levels and the need for more effective risk management.
Overall, Canara Bank’s decision to cut lending rates is seen as a significant step towards supporting the economy and providing relief to borrowers. However, it remains to be seen how other banks will respond to this development and whether the rate cuts can be passed on to customers in the form of lower interest rates.
Earn high yields with small finance banks, offering competitive interest rates of up to 9%
In response to the Reserve Bank of India’s (RBI) recent 25 basis points repo rate cut, investors are seeking high-yield fixed deposit (FD) schemes. Small finance banks have emerged as a promising option, offering interest rates as high as 9% per annum for specific tenures. Small finance banks are a category of banks established by the RBI to promote financial inclusion, providing essential banking services to underserved segments of society, such as small farmers, micro-businesses, and unorganized sector workers.
Some of the small finance banks offering high-yield FDs include Unity Small Finance Bank, NorthEast Small Finance Bank, Suryoday Small Finance Bank, Utkarsh Small Finance Bank, Jana Small Finance Bank, and Ujjivan Small Finance Bank. These banks offer a range of FD schemes with interest rates varying between 7% to 9% per annum, depending on the tenure.
It’s essential to note that small finance bank FDs are insured by the Deposit Insurance and Credit Guarantee Corporation (DICGC) up to Rs 5 lakh per depositor. Experts recommend keeping deposits within this insured limit for maximum safety. While small finance banks offer higher interest rates, they operate differently from larger commercial banks, emphasizing the importance of risk management for investors.
In conclusion, small finance banks have emerged as a viable option for investors seeking high-yield FDs. However, it’s crucial to carefully evaluate the risk factors and consider the DICGC insurance limit to ensure maximum safety. With interest rates ranging from 7% to 9% per annum, small finance banks may be an attractive option for investors seeking sustenance and growth.
Searching for competitive returns? Consider these small finance banks offering up to 9% interest rates
In the wake of the Reserve Bank of India’s recent 25-basis-point repo rate cut, investors are actively seeking fixed deposit (FD) schemes with attractive returns. Small finance banks, established to promote financial inclusion, are now offering interest rates as high as 9% per annum for specific tenures.
Small finance banks are a unique category of banks set up by the RBI to bridge the gap in access to banking services for small farmers, micro-businesses, and workers in the unorganized sector. These banks offer a range of fixed deposit schemes, with some offering interest rates as high as 9% per annum. For instance, Unity Small Finance Bank offers 9% for a 1001-day FD, while NorthEast Small Finance Bank offers 9% for deposits between 18 months and 36 months.
Other small finance banks, such as Suryoday, Utkarsh, Jana, and Ujjivan, offer interest rates ranging from 8.1% to 8.5% per annum for deposits ranging from one to five years. AU Small Finance Bank offers 8.1% for an 18-month FD and 7.25% for a one-year FD.
While small finance banks offer higher interest rates, it’s essential to note that deposits up to Rs 5 lakh per depositor are insured by the Deposit Insurance and Credit Guarantee Corporation (DICGC). However, financial experts recommend keeping deposits within this insured limit for maximum safety. As these small finance banks operate differently from larger commercial banks, risk management is crucial for investors.
Overall, small finance banks’ FD schemes can be a viable option for investors seeking attractive returns, but it’s important to consider the associated risks and ensure that deposits are within the insured limit to ensure maximum safety.
Maximize your returns: Compare FD interest rates up to 9% with top banks, including 1-year fixed deposits at MSN.
The article discusses the current fixed deposit (FD) interest rates offered by various banks in India. With the Reserve Bank of India (RBI) increasing the interest rate to 9% to control inflation, banks have also hiked their FD rates to attract depositors. Here are the highest and one-year FD interest rates offered by different banks in India:
Highest FD Interest Rates:
- Axis Bank: 9.10% (for a deposit of ₹2.5 lakh to ₹5 lakh)
- HDFC Bank: 9.05% (for a deposit of ₹2.5 lakh to ₹5 lakh)
- ICICI Bank: 9.00% (for a deposit of ₹2.5 lakh to ₹5 lakh)
- SBI: 8.90% (for a deposit of ₹1 lakh to ₹1 crore)
- Kotak Mahindra Bank: 9.00% (for a deposit of ₹2 lakh to ₹5 lakh)
One-Year FD Interest Rates:
- Axis Bank: 7.50%
- HDFC Bank: 7.40%
- ICICI Bank: 7.30%
- SBI: 7.20%
- Kotak Mahindra Bank: 7.20%
Other Top Banks’ FD Rates:
- Bank of Baroda: 8.60% (for a deposit of ₹1 lakh to ₹5 crore)
- Yes Bank: 8.40% (for a deposit of ₹1 lakh to ₹5 crore)
- IndusInd Bank: 8.30% (for a deposit of ₹1 lakh to ₹5 crore)
- Punjab National Bank: 8.20% (for a deposit of ₹1 lakh to ₹5 crore)
Things to Keep in Mind:
- The interest rates mentioned are subject to change and may vary based on the deposit amount, tenure, and other factors.
- It’s essential to compare the different FD rates offered by various banks before investing.
- It’s also important to consider other factors such as the bank’s reputation, branch network, and customer service while choosing an FD.
- FDs can be a low-risk investment option, but it’s crucial to assess your financial goals and risk tolerance before investing.
In conclusion, with the RBI increasing the interest rate to 9%, banks have also hiked their FD rates to attract depositors. The interest rates mentioned above are effective as of the date of the article and may change over time. It’s essential for investors to stay informed about the current FD rates and rates offered by different banks before making an investment decision.
According to SBI MF’s report, consumption is expected to be outperformed by investments in the financial year 2026.
A recent report by SBI Mutual Fund predicts that investments in India are likely to outpace consumption in the financial year 2025-26 (FY26). The report suggests that the country’s gross domestic product (GDP) is expected to grow by 6.5-7% in FY26, down from 7.5-9% in the previous two years, but still considered a healthy rate of expansion. The report cites increased investments, rural consumption, and higher government spending as key drivers of growth in the coming quarters.
The report highlights a shift in the government’s and Reserve Bank of India’s (RBI) policies, which were previously focused on consolidation and inflation control. However, the RBI has now initiated interest rate cuts, improved liquidity, and relaxed credit regulations to support economic growth. On the fiscal front, the government is maintaining its consolidation efforts but is expected to better meet its spending targets, contributing to growth.
The report notes that corporate order books remain strong, indicating a stable private investment pipeline, and nominal GDP growth could pick up to 10-11% in FY26, up from 9-10% in FY25. With both monetary and fiscal policies now focused on economic expansion, investments are likely to be the primary driver of growth in FY26, surpassing consumption as the main contributor.
This positive outlook is supported by India’s 6.2% GDP growth in the third quarter of FY25, a recovery from the revised 5.6% in the previous quarter. The report concludes that investments are likely to be the key driver of growth in FY26, leading to a robust economic expansion.