FD rates slipping, home loan gains peaking: RBI pause is your cue to lock in now

If you’re a senior citizen relying on fixed deposits, or a borrower eyeing a home loan, this is the moment to act.

After holding the repo rate steady at 5.5%, the Reserve Bank of India has signaled a turning point. For borrowers, the RBI’s 100 basis point cut since January has already delivered major gains. For depositors, especially seniors, that window of high FD rates is beginning to shut.

Let’s break it down.

For home loan borrowers

If you took a ₹50 lakh home loan for 20 years at the start of the year when rates were around 8.5%, and your bank has passed on the full 100 bps cut, your new rate could be 7.5%. What’s the impact?

If you reduce your EMI: you save ₹7.5 lakh over the life of the loan.

If you keep the EMI same: you chop years off your loan term and save ₹15.4 lakh in interest.

As BankBazaar CEO Adhil Shetty points out, “With banks maintaining their spreads and festive offers on processing fees and special rates, this is one of the best times in recent years to invest in a home.”

This is not just rate talk—it’s real cash in your pocket.

For depositors

Now, flip the coin. Fixed deposit rates are already edging down. Banks that once offered 7.5–7.75% are now quoting 6.75–7% for top tenures. Only a few outliers still offer above 7.25%, and that too selectively.

Senior citizens are holding on to a 25–50 bps premium, but even that’s on borrowed time. Earlier this year, 3-year FDs for seniors could fetch 7.75%. Now, most hover around 7.25%, and slipping.

“Even with no fresh cut today,” Shetty warns, “the peak of deposit rates is behind us. Savers would do well to lock into multi-year deposits while these levels still hold.”

If you’re a homebuyer, this could be your best shot at locking a low-interest loan before the next cycle turns. If you’re a senior saver, now is the time to fix your returns for 3–5 years before rates slip further.