Reserve Bank of India (RBI) has reduced the Bank Rate by 25 basis points, lowering it from 6.75% to 6.50%, effective immediately. This revision follows the announcement in the Monetary Policy Statement for 2024-25 on February 7, 2025. As a result, all penal interest rates on shortfalls in reserve requirements, which are directly linked to the Bank Rate, have also been adjusted. Specifically, the penal interest rate will now be Bank Rate plus 3.0 percentage points (9.50%) or Bank Rate plus 5.0 percentage points (11.50%), depending on the duration of the shortfall. The revision aligns with RBI’s broader monetary policy measures to regulate liquidity and financial stability.
Reserve Bank of India
RBI/2024-25/111
DoR.RET.REC.57/12.01.001/2024-25 Dated: February 07, 2025
All Banks
Madam / Dear Sir,
Change in Bank Rate
Please refer to our circular DOR.RET.REC.101/12.01.001/2022-23 dated February 08, 2023 on the captioned subject.
2. As announced in the Monetary Policy Statement dated February 07, 2025, the Bank Rate is revised downwards by 25 basis points from 6.75 per cent to 6.50 per cent with immediate effect.
3. All penal interest rates on shortfall in reserve requirements, which are specifically linked to the Bank Rate, also stand revised as indicated in the Annex.
Yours faithfully,
(Latha Vishwanath)
Chief General Manager
Encl.: As above
Annex
Penal Interest Rates which are linked to the Bank Rate
| Item | Existing Rate | Revised Rate (With immediate effect) |
| Penal interest rates on shortfalls in reserve requirements (depending on duration of shortfalls). | Bank Rate plus 3.0 percentage points (9.75 per cent) or Bank Rate plus 5.0 percentage points (11.75 per cent). | Bank Rate plus 3.0 percentage points (9.50 per cent) or Bank Rate plus 5.0 percentage points (11.50 per cent). |
