Every few months a regulatory draft lands and the headlines around it get read as “your EMI is about to change.” Usually it isn’t true, and the gap between what the rule says and what people think it says costs borrowers real money — because they either wait for a benefit that was never coming, or panic about a cost that doesn’t apply to them.
So: on 12 August 2026 the Reserve Bank of India released a draft — the Reserve Bank of India (Interest Rates on Loans and Advances) Directions, 2026 — proposing a single, common framework for how banks and NBFCs price loans. It follows from the RBI’s 5 August statement on developmental and regulatory policies. Public comments are open until 11 September 2026, and the rules are proposed to take effect from 1 April 2027.
I run Securis, so I read this the way a lender does. But I want to write it up the way a borrower should read it, which is a much shorter document than the headlines suggest.
What the draft actually proposes
Four things matter for a retail borrower.
One: every floating-rate loan gets a proper benchmark, and it resets fast. Floating-rate loans would have to be linked to an internal or external benchmark, and that benchmark would reset at least every three months. Floating-rate personal loans and MSME loans from commercial banks would have to sit on an external benchmark specifically. The point is rate transmission — when policy rates fall, the benefit is supposed to reach you inside a quarter.
Two: the non-credit-risk part of your spread gets frozen for three years. Your rate is the benchmark plus a spread. Part of that spread reflects you — your credit profile. The rest reflects the lender’s costs and margin. Under the draft, that second part can’t be revised for three years. That’s a meaningful protection: it stops a rate from drifting upward for reasons that have nothing to do with the borrower.
Three: nobody switches your benchmark without your consent. A lender can’t unilaterally move your loan from one benchmark to another, and when a switch does happen, the new rate can’t be higher than the rate that applied immediately before it. Existing floating-rate loans migrate to the new structure by 1 April 2029 — with consent, no extra fees, and no rate increase attached to the migration.
Four: pricing has to be written down and board-approved. Each lender needs a board-approved policy setting out how it prices loans, what its internal benchmarks are, and what goes into the spread. The RBI has also noted that fixed-rate loans had relatively little standing guidance, and the draft is meant to be a principles-based framework covering both.
This is consumer-protection design, and it’s the right direction. Loan pricing is the one number every borrower is judged on and almost nobody can reconstruct.
Now the honest part: most of this doesn’t touch a small personal loan
Here’s what gets lost in the coverage. Benchmark resets, spread freezes, migration deadlines — all of that is the machinery of floating-rate lending. It’s built for the 20-year home loan, where a quarter-percent drift compounds into lakhs.
A typical Securis personal loan is ₹50,000 to ₹5 lakh over 12 to 36 months, at a fixed rate. The rate you’re quoted at sanction is the rate you pay in month 24. There is no reset to wait for and no benchmark to be switched out from under you. If you’re reading this hoping the April 2027 date means your EMI drops — on a fixed-rate loan, it doesn’t, and I’d rather say that plainly than let you plan around it.
What the draft does do for you is push the whole market — banks and NBFCs alike — toward pricing that is documented, board-approved and explicable. That’s slower and less dramatic than a rate cut, but over a few years it’s worth more.
Considering a personal loan? Apply for a Securis loan — typical disbursement is 1-2 working days, and you’ll see your exact EMI and total repayment before you commit to anything.
What to actually do, today
Forget April 2027. Here are the numbers that decide what a personal loan costs you right now.
Read the Key Fact Statement, not the ad. The KFS is mandatory, it’s one page, and it carries the annualised rate, the processing fee, the total amount repayable and the EMI. That’s your loan. A headline rate on a landing page is a starting rate for the best-profile applicant, not a quote.
Run the total, not the EMI. Take ₹2,00,000 over 24 months at 16% APR on reducing balance. The EMI is about ₹9,793, total repayment about ₹2,35,000 — roughly ₹35,000 of interest. Now borrow ₹3,00,000 over 36 months at the same 16%: the EMI is about ₹10,547, but the interest goes to roughly ₹79,700. The monthly number moved by about ₹750 — the total cost more than doubled. Size and tenure are the levers almost everyone gets wrong, because both of them hide behind a comfortable-looking EMI.
Know what a percentage point is actually worth. Same ₹2,00,000 over 24 months: at 16% you pay about ₹35,000 in interest, at 17% about ₹37,300. That’s a difference of roughly ₹95 a month. Worth negotiating for — not worth taking a worse tenure or a bigger loan to chase.
Check the fees, then check them again. Processing fee, any documentation charge, and what a bounced EMI costs. On a ₹2 lakh loan a 2% processing fee is ₹4,000 — more than a full percentage point of rate over the term. It’s the most under-read line on the sheet.
If a rate is floating, ask for the reset frequency in writing. For any floating-rate borrowing you hold — a home loan especially — the three-month reset direction is the part of this draft worth tracking.
Skip this line of thinking if…
You’re comparing product categories, not rates. If you need ₹6 lakh for tuition disbursed to a college, a personal loan is the wrong instrument regardless of pricing — that’s a bank education loan, and your bank’s education loan desk is the right first call. Product fit beats a rate difference every time.
Your FOIR is already stretched. No pricing framework helps if the EMI doesn’t fit. If your existing obligations already eat a large share of your take-home, the honest answer is a smaller loan or a delayed one, not a cheaper one.
You’re waiting for 2027 to borrow. If the need is real and now — a medical bill, a consolidation that stops the bleeding on higher-cost debt, a device you need to earn — a draft framework with an April 2027 start date is not a reason to wait. Borrow what you need, on a tenure you can finish, at a rate you understood before you signed.
One last thing worth saying: the consultation window is open to the public until 11 September. Borrowers rarely write in. If you’ve had a loan repriced in a way you couldn’t explain, that’s exactly the kind of input these drafts are asking for.
If you want a second opinion on your specific situation, WhatsApp us — we’ll be honest about whether Securis fits.