What changes from October 1? Interest on advances, RBI cheque clearing & more
What changes from October 1? Interest on advances, gold metal loans, RBI cheque clearing and more
A series of financial and regulatory changes which impact people and institutions are scheduled to be implemented from 1 October 2025. These decisions include the Reserve Bank of India's (RBI) amendments on interest on advances, gold metal loans to Indian Railways, tightening the online booking norms for customers.
Key things that will change from October 2025
1. Interest rate on advances: India's banking regulator, RBI, has allowed banks that they are free to decide on the interest rate of floating-rate loans to benefit the borrowers sooner than the previous three-year limit.The banks will also be able to provide their borrowers with the option to switch from a fixed interest rate setup to a floating interest rate setup, at their discretion, from 1 October 2025.
2. Loans against Gold/Silver collateral: The RBI, in an official release, announced that they have amended a ‘carve-out' for scheduled commercial banks (SCBs) to grant working capital loans to jewellers.
The banking regulator also allowed the Tier 3 and Tier 4 Urban Co-operative Banks to grant working capital loans to a borrower who uses gold as a raw material or input in its manufacturing or industrial processing activities from 1 October 2025.
3. Capital regulations on Perpetual Debt Instruments: RBI also revised its eligibility limits for Perpetual Debt Instruments (PDIs), which are denominated in foreign currency or rupee-denominated bonds overseas. This move aims to provide banks with additional capital headroom to raise funds from their overseas markets, effective from 1 October 2025.
4. Continuous cheque clearing: From 4 October 2025, the RBI will switch from batch to a continuous cheque clearing system, which means that the cheques will be cleared multiple times during a working day, instead of the current batch-wise system.
As per the RBI data, the central bank has also released four drafts open for industry and stakeholder comments till 20 October 2025 for key proposals ranging from Gold metal loans to credit information reporting.
5. Gold metal loans: RBI proposed that the banks may now offer longer loan repayment tenors of up to 270 days, compared to the current 180-day period for gold metal loans, and also extend loans to the domestic non-manufacturers outsourcing the jewellery production.
6. Large Exposures Framework (LEF) and Intra-Group Exposures (ITE): The Reserve Bank of India (RBI) also proposed that the foreign banks operating in India will have to clarify their exposure computation, risk mitigation, and linking thresholds to Tier-1 capital.
7. Credit information reporting: RBI also aims to move to a weekly credit information reporting system to make sure that the credit information is up-to-date with provisions for faster data submission, error rectification, and CKYC data capture.
These amendments by the nation's central bank aim to enhance the flexibility of banks, improve credit access for borrowers, and ensure timely and accurate credit reporting within the financial system.
8. HDFC rules for Imperia customers: India's largest private sector bank, HDFC Bank, informed its customers that the new eligibility norms for the Imperia clients will apply from 1 October 2025. People who joined the programme on or before 30 June 2025 must meet the revised Total Relationship Value (TRV) criteria to retain their premium banking services.
9. PNB increases locker, service charges: Punjab National Bank increased its lockers and some service request charges for its customers effective from 1 October 2025. The charges which will cost more now will be ocker fees, standing instruction failures, and nomination charges.
10. Indian Railways tightening online booking norms: From 1 October 2025, the Indian Railways booking platform IRCTC will implement new Aadhaar-based guidelines for booking general tickets online. The authorities aim to reduce the misuse of the reservation system by fraudulent agents.
11. YES Bank salary account fees: YES Bank customers who have their salary account with the private bank are set to face updated charges on their account services, including cash transactions, ATM withdrawals, debit card fees, and penalties for returning checks.
12. More expensive to use Speed Post? India Post will also revise its Speed Post charges from 1 October 2025, while implementing a new OTP-based delivery system for the security of the packages.
13. PFRDA revisions: The Pension Fund Regulatory and Development Authority (PFRDA) has announced a set of updated fees for the Central Recordkeeping Agencies in charge of NPS and associated programs set to be effective from 1 October 2025.
Non-government subscribers will have more flexibility, as they can invest up to 100% in stocks from the beginning of October.
14. NPS vs UPS deadline: The government employees have until Tuesday, 30 September 2025, to choose between the Unified Pension Scheme (UPS) and the National Pension System (NPS), as after the deadline, no transitions between the two will be allowed.
Source: LiveMint
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