Financial & Economic Changes in India from October 2026

What the RBI deposit rules actually do

The most widely misreported item this month is the RBI's amended deposit-rate directions. They are real, they take effect on 1 October 2026, and they do not raise or lower anyone's FD rate. What changes is disclosure and consistency.

• Before: banks had wide discretion in how deposit rates — particularly on bulk deposits — were quoted and applied, so two customers could be offered different rates on the same day for the same product.
• From 1 October 2026: interest must follow the rate schedule published on the bank's website. Rates must be uniform across branches and customers for similar deposits accepted on the same date. Bulk deposit rates must be published on the bank's website every business day by 10:00 am, with a ten-minute grace period.
• Bulk deposit generally means a term deposit of ₹3 crore or more at a scheduled commercial bank. Banks may still price these differently based on Liquidity Coverage Ratio run-off categories — the flexibility survives, the secrecy does not.
• Senior citizen preferential rates continue. The directions do not remove them.

ATM and cash withdrawal charges

These are bank-level commercial decisions, not RBI rules. SBI is the largest mover this month, and the two changes affect different customers:

For BSBD accounts, "cash withdrawal" counts branch, ATM, micro-ATM, AePS and CASH@POS transactions together. UPI, NEFT, RTGS, IMPS and card payments are not counted — which is the practical escape route for anyone near the limit.

Canara Bank made a comparable change from 1 September 2026, cutting free monthly transactions at its own ATMs for regular savings customers from six to five. Other banks may follow. Check your own bank's service charge page rather than assuming.

KYC and customer protection

No new nationwide KYC rule takes effect on 1 October 2026. The CKYC reuse facility — which lets you reuse previously verified KYC records across participating financial institutions after OTP-based consent instead of resubmitting PAN, Aadhaar and address proof — has been operating since August 2026. Two-factor authentication with at least one dynamic factor has been mandatory on domestic digital payments since 1 April 2026.

How RBI rate changes can affect you

Transmission is never uniform. It differs by product, by bank, and by whether your loan is linked to the repo rate (EBLR), to the bank's own MCLR, or to an older base rate. A depositor and a borrower at the same bank can experience the same policy change very differently, and months apart.

What it costs a merchant, in rupees

At 0.4%, a ₹3,000 sale costs the merchant ₹12. A ₹10,000 sale costs ₹40. Because the fee is capped at ₹300, a ₹75,000 transaction attracts the full cap, and anything above ₹75,000 still costs ₹300 — so the effective rate falls as ticket size rises. Revenue is split with issuer banks taking 40% of the 40-basis-point MDR, merchant acquirers 30%, UPI apps 20% and their bank partners 10%.

UPI limits — unchanged

• Person-to-person transfers: ₹1 lakh per day. Unchanged.
• Person-to-merchant, verified categories such as insurance, capital markets, travel and collections: up to ₹5 lakh per transaction and ₹10 lakh per day, in force since September 2025.
• Biometric-authenticated UPI payments: per-transaction limit raised from ₹5,000 to ₹10,000 from 7 August 2026.
• NPCI's user-information masking rules — last four digits of a mobile number only, no number shown on QR payments, non-mobile UPI IDs available — took effect on 4 September 2026.

The CBDT extension announced on 28 September 2026

CBDT announced the extension by press release on 28 September 2026 and stated that a formal order giving effect to it would be issued separately. This extension applies only to taxpayers covered by the audit provisions. It does not reopen the non-audit deadlines that have already passed.

Which law applies to which year

This trips people up in 2026, so it is worth stating plainly. Returns for Assessment Year 2026-27 — the ones due now — relate to income earned in FY 2025-26 and are governed by the Income-tax Act, 1961. The Income-tax Act, 2025 took effect on 1 April 2026 and applies to income from tax year 2026-27 onward, which you will file in 2027. The new Act replaces the "previous year / assessment year" pair with a single Tax Year, and renumbers sections throughout.

What has not changed

• Income tax slabs: no change in October 2026. Slab changes come through the Union Budget.
• TDS and TCS rates: no nationwide rate change takes effect in October 2026.
• Capital gains: no confirmed change effective October 2026.
• Advance tax: the next instalment (cumulative 75%) is due 15 December 2026, not in October.

One dated item worth knowing if a property deal is in progress: from 1 October 2026, resident individual and HUF buyers purchasing immovable property from a non-resident seller no longer need a TAN and can deposit TDS using their PAN through a challan-cum-statement. Company and firm buyers still need a TAN. This is a procedural relief announced in the Union Budget 2026-27 — TDS rates and the buyer's liability are unchanged.

What applies right now

• Rate structure: the two-tier structure of broadly 5% and 18%, with 40% on a short list of sin and luxury goods and the 12% and 28% slabs removed, has applied since 22 September 2025 following the 56th Council meeting. No new rate schedule has been notified for October 2026.
• Monthly returns: GSTR-1 by 11 October and GSTR-3B by 20 October 2026 for the September period, subject to your filing frequency and state.
• Three-year time bar: the statutory limit on late filing is enforced on the portal. Once the window closes on an old return period, it closes permanently — the change that has hurt small businesses most in 2026.
• Invoice Management System and hard-locked GSTR-3B liability continue to govern input tax credit at invoice level.
• Compensation cess was discontinued on specified goods from 1 February 2026.

The distinction in the right-hand column matters more than most coverage admits. If rates are cut, an existing SCSS or NSC holder is unaffected — the rate was fixed on the day they opened it. A PPF or SSY holder is affected immediately, across the entire balance. If rates are raised, the position reverses.

EPF and mutual funds

• EPF: 8.25% for FY 2025-26, approved by the Central Government in June 2026 — the third consecutive year at this rate. The FY 2026-27 rate will be decided towards the end of that year. The EPF Scheme, 2026 replaced the 1952 scheme from 30 June 2026 without changing contributions or entitlements.
• Mutual funds: no major change takes effect on 1 October 2026. The SEBI (Mutual Funds) Regulations, 2026 took effect on 1 April 2026, separating the Base Expense Ratio from statutory levies and brokerage. The SEBI nomination framework for new single-holder demat accounts and MF folios took effect on 1 September 2026.
• One dated operational item: under a SEBI circular of 17 July 2026 extending SWP and STP standing instructions to mutual fund units held in demat form, depositories must publish the standard operational framework by 31 October 2026. Investor-facing rollout follows in phases through April 2027.

Check your EMI and a possible rate change

What a borrower should actually do this month

• Find your loan's benchmark and reset date on your sanction letter or statement. Most borrowers do not know whether they are on repo-linked (EBLR), MCLR, or a legacy base rate.
• If you are on a legacy benchmark, ask your bank for the switch-over cost in writing and compare it against the interest saved over your remaining tenure.
• Read your credit card issuer's revised terms rather than a summary. The 2026 reward devaluations have been category-specific — rent, utility and insurance spends most often — so whether you are affected depends entirely on where you spend.
• Remember that credit information companies now receive fortnightly reporting, so a missed EMI reflects in your bureau record within about two weeks.

• If you bank with SBI on a Salary Package Account, your free monthly transactions at other banks' ATMs and ADWMs drop from 10 to 5 from 1 October 2026. Transactions at SBI's own machines are unchanged.
• If you joined NPS through a bank branch or other Point of Presence, the revised PFRDA charge structure applies from 1 October 2026 — ₹200 one-time onboarding per PRAN, recovered at ₹50 a quarter, plus 0.20% a year of assets under management.
• If you are a central government employee or pensioner, DA stands at 60% of basic pay, effective 1 January 2026. The July 2026 instalment has not been announced. Historically the Cabinet announces it between September and November, with arrears from 1 July paid alongside a subsequent month's salary. Nothing is confirmed until the Cabinet decides.
• If you missed an ITR deadline, the belated route stays open until 31 December 2026 with late fee and interest. The 28 September extension applies only to audit cases.
• Your EPF earns 8.25% for FY 2025-26. No action needed.

Checklist

• Check your bank's revised ATM and withdrawal charges for October
• If you hold NPS through a PoP, read the revised charge schedule on their website
• Check whether your home loan reset date falls after the 7 October MPC decision
• If your ITR is still unfiled, file belated before 31 December 2026
• Confirm your LPG connection's Biometric Aadhaar Authentication is complete
• Review FD maturities falling on or after 1 October against the bank's published rate card

• FD rates: the RBI's 1 October directions improve disclosure, not returns. Preferential senior citizen rates are not removed. If a deposit matures on or after 1 October, check the bank's published rate card before letting it auto-renew — automatic renewal at a lower prevailing rate is the most common avoidable loss for depositors.
• SCSS: 8.2% for the July–September quarter. Because SCSS locks the rate on the day you open the account, a future cut would not affect an existing account. The October–December notification was due on 30 September and is not yet confirmed.
• Pension and DR: Dearness Relief is revised at the same rate as DA. The July 2026 instalment has not been announced.
• LPG: if Biometric Aadhaar Authentication is not complete, subsidised refill booking pauses from 1 October until it is done. Authentication can be completed at the doorstep when the delivery person arrives, at the distributor's showroom, or through the oil company's mobile app.
• Cash withdrawals: if you hold an SBI BSBD account opened through a branch, four cash withdrawals a month remain free; the fifth onwards costs ₹15 plus GST. Branch, ATM, micro-ATM, AePS and CASH@POS withdrawals all count toward that four.

The UPI MDR change is the one that matters

From 15 October 2026 you pay 0.4% on UPI merchant payments above ₹2,000, capped at ₹300. Before assuming it applies to you, check three things:

• Are you a P2PM micro-merchant? NPCI describes small merchants as those receiving up to ₹1 lakh a month through UPI QR codes. Those transactions attract zero MDR.
• Is your category on the flat-fee list? Railways, telecom, insurance, fuel and utilities pay a flat ₹5 per transaction above ₹2,000 instead of the percentage.
• What proportion of your sales are above ₹2,000? If your average ticket is ₹400, this change costs you nothing. If you sell electronics or furniture, model it properly.

Operational parameters, fee distribution and category-wise caps are set by the UPI and Services Steering Committee headed by NPCI. Watch for the formal circular and any clarification on GST treatment of MDR before you reprice anything.

Other business-relevant items

• Cross-border service payments: from 1 October 2026 the RBI shifts responsibility for validating the legitimacy of cross-border service payments onto commercial banks, which must independently verify contracts and trade data rather than relying on central bank caution lists. If you import or export services, expect more documentation requests from your bank.
• Tax audit: report due 21 October 2026, ITR due 21 November 2026 for audit cases.
• TDS/TCS quarterly statements for July–September are due 31 October 2026.
• GST: GSTR-1 by 11 October, GSTR-3B by 20 October. Council decisions from the 7 October meeting will not apply until notified.

Deliberately not listed: monthly LPG and ATF price revisions on the 1st. Oil marketing companies revise these every month; the direction and amount are unknown until announced, so Arthzo records the actual revision in the update log rather than predicting it.

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Market expectations and analyst forecasts are shown separately from confirmed government or regulatory decisions. An expected DA hike is not a DA hike. A scheduled GST Council meeting is not a GST change. A draft RBI circular under consultation is not a rule. This page keeps those apart deliberately, because the most common error in monthly "new rules" coverage is presenting one as the other.

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