Repo Rate Hike: Will Banks & NBFCs Hike FD Interest Rates By 25 Bps? SBI, HDFC, ICICI, Bajaj Latest FD Rates

For the first time in more than 3 years, RBI has brought back the rate hike cycle with a 25 bps increase in the policy repo rate to 5.5% on October 7. This will make fixed deposit interest rates attractive, as many banks have linked their key interest rates to the RBI benchmark. This is definitely good news for depositors ahead of the festive season. Largest NBFC, Bajaj Finance, has already kicked off with a 40 basis point hike in their FDs with effect from today. Will others follow soon?

After detailed assessment, RBI has hiked policy repo rate by 25 basis points to 5.50% from previous 5.25%. Further, the standing deposit facility (SDF) rate stands adjusted at 5.25 per cent and the marginal standing facility (MSF) rate and the Bank Rate at 5.75 percent. The MPC also decided to change the stance to calibrated tightening for the first time since October 2018.

How Repo Rate Hike Impacts FD Rates?

The Reserve Bank of India’s (RBI) repo rate is one of the biggest influences on the deposit rates offered by banks. When the RBI raises the repo rate, borrowing becomes more expensive for banks and NBFCs, so to offset this higher cost of funds, banks usually raise the interest rates they offer on fixed deposits. FD rates also move with other policy rates, such as the CRR and CD ratio, as per SIDBI blog.

Will FD Rates Increase In October?

“”The 25 bps repo rate hike was broadly expected, and a part of the impact had already been reflected in the market, with several banks adjusting their FD rates ahead of the policy announcement. For fixed income investors, the current rate environment remains constructive, with higher rates offering an opportunity to lock in relatively attractive yields across FDs and bonds,” said Saurabh Jain, Co-founder & CEO, Stable Money.

He also said that the RBI’s continued focus on keeping inflation under control, along with its management of system liquidity, will remain important for the direction of rates going forward. The increase in FCNR(B) deposit limits and the resulting inflows have also added to liquidity in the system.

However, Jain added that with another rate increase being anticipated in the December MPC meeting, investors with a defined investment horizon can consider gradually locking in rates rather than waiting to time the peak of the cycle. A staggered approach across FDs and bonds, aligned with financial goals, liquidity needs and credit quality, can help investors make the most of the current fixed income environment while retaining flexibility as rates evolve.

Bajaj Finance Hikes FD Rates

The first to make the move is Bajaj Finance right after RBI hikes repo rate. The NBFC hiked its FD rates in the range of 15 basis points to 40 basis points with effect from October 7, 2026. These new rates are across tenures of 14 months to 60 months.

Accordingly, Bajaj Finance is offering 7.75% rate on 31-60 months tenure from earlier rate of 7.40%. Senior citizens can now earn up to 8.15% from earlier 7.75%.

Also, Bajaj Finance hiked FD rates by 20 basis points to 6.80% on 12-17 months tenure. The rate increased by 15 basis points on 18-30 months tenure to 7%. These rates are for general category individuals.

But senior citizens are in for a great win as for them FD rates are increased by up to 40 bps. For elderlies, the rate is now at 7.20% on 12-17 months tenure from earlier 6.95%, while the new rate is 7.40% on 18-30 months tenure from earlier 7.20%.

Major banks are yet to revise their FD rates. Check out latest interest rates.

SBI FD Interest Rates

The largest PSU bank is offering 3.05% to 6.40% interest rates on FDs below Rs 3 crore to general category. While senior citizens can earn interest rates in the range of 3.55 to 7.05%.

HDFC Bank FD Rates Latest

For FDs below Rs 3 crore, HDFC Bank is offering interest rates of 2.75% to 6.50% to general category, while rates vary from 3.25% to 7.10% to senior citizens. The tenues range from 7-days to 10 years.

ICICI Bank FD Rates Latest

ICICI Bank’s popular FD scheme is offering 6.5% rate to general category on tenures like 3 Years 1 Day to 5 Years and 5 Years 1 Day to 10 Years. Senior citizens get from 7% to 7.1%. The lowest FD rate is of 2.75% on 7-14 days tenure to general individuals and 3.25% to elderlies.

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