The Reserve Bank of India has released fresh data on bank lending and deposit rates for scheduled commercial banks (SCBs) in October 2026. The figures cover all SCBs excluding regional rural banks and small finance banks. Overall, the data points to a gradual easing trend in both lending and deposit rates.
Bank Lending Rates Show Mixed Movement
The weighted average lending rate (WALR) on outstanding rupee loans remained steady at 8.96 per cent in September 2026, unchanged from August 2026. However, the WALR on fresh rupee loans declined to 8.51 per cent in September from 8.61 per cent in August. This drop suggests banks are offering slightly cheaper loans to new borrowers.
Additionally, the 1-year median Marginal Cost of Funds based Lending Rate (MCLR) fell to 8.55 per cent in October 2026, down from 8.61 per cent in September 2026. Therefore, borrowers linked to MCLR-based loans may see some relief in their EMIs. Across sectors, the WALR on both fresh and outstanding loans showed mixed movement in September 2026.
Deposit Rates Also Edge Lower
On the deposits side, the weighted average domestic term deposit rate (WADTDR) on outstanding rupee term deposits declined marginally to 6.55 per cent in September 2026 from 6.56 per cent in August 2026. Meanwhile, the WADTDR on fresh rupee term deposits fell more noticeably, dropping to 5.61 per cent from 5.67 per cent in the same period. As a result, savers opening new fixed deposits may earn slightly lower returns than before.
For example, customers comparing new FD offers across banks should factor in this declining rate environment. The gap between fresh and outstanding deposit rates remains significant, reflecting older deposits locked in at higher rates.
What This Means for Banking Customers
The steady WALR on outstanding loans offers some predictability for existing borrowers. However, the fall in fresh loan rates is a positive signal for those planning to take new home, auto, or personal loans. Banks appear to be cautiously transmitting the benefit of easier monetary conditions to new customers.
For depositors, the declining fresh deposit rates mean locking in a fixed deposit sooner rather than later could be a smart move. Overall, these October 2026 figures reflect a softening rate cycle in India’s banking sector. Customers should review their loan and deposit terms in light of these latest RBI data.
Source: RBI Press Releases
