RBI’s New Banking Rules From October 1: Relief in EMIs and Gold Loans
RBI’s New Banking Rules From October 1: Relief in EMIs and Gold Loans
Floating rate loans to be reset faster, gold loans extended to industries, and new draft guidelines open for public feedback.
The Reserve Bank of India (RBI) has announced a set of new banking regulations effective from October 1, 2025, bringing relief to borrowers of EMIs, personal loans, and gold loans. The changes are aimed at making banking more flexible and borrower-friendly while strengthening regulatory oversight.
Key Insights
A repo rate cut could now ease monthly budgets faster.
With better transmission, personal cash flow management becomes easier.
Banks, too, gain flexibility to compete on interest rates, potentially creating more borrower-friendly options
Floating Rate Loans and EMIs
Earlier, banks could revise the interest spread on floating-rate loans only once every three years. Under the new rules, banks can now reduce loan interest rates earlier, in line with falling market rates. This means borrowers will receive quicker relief on EMIs when interest rates decline. In addition, customers will have the option to switch to a fixed rate at the time of their EMI reset, offering greater choice and stability.
Gold and Silver Loans
Gold and silver loans, previously restricted mainly to jewelers, will now be extended to factories and industrial units that use gold as raw material. Tier 3 and Tier 4 urban cooperative banks have also been permitted to issue such loans, expanding access for small businesses and industries in semi-urban areas.
Capital Regulation and Draft Guidelines
The RBI has also updated regulations concerning banks’ capital management. Alongside this, four draft guidelines have been released for public consultation, covering:
- Extension of the gold metal loan term to 270 days.
- Clarification of rules governing transactions with foreign banks.
- Introduction of weekly credit reporting by banks.
- Other adjustments to strengthen compliance.
The RBI has invited public feedback on these draft guidelines until October 20, 2025.
