As State Bank of India (SBI) raises interest rates by up to 75 basis points for its term deposits, the senior citizens are entitled to another 50 basis points interest rate over and above the raised limits. The maximum rate of interest that will now be offered to the senior citizens is 7 per cent as against 6.5 per cent earlier. This new rate of interest will be offered in case of deposits that are made for two years or longer.
- SBI term deposits interest rates by up to 75 basis points
- Senior citizens entitled to another 50 basis points above raised limits
- Maximum rate of interest offered to senior citizens now 7%
For the deposits made for a relatively short duration (i.e. less than two years), the rate of interest offered will be marginally lower at 6.9 per cent. To be able to earn this interest, the senior citizens are meant to make the deposits for a minimum of 211 days and for a maximum of two years. Earlier, the rate of interest for this time period stood at 6.75 per cent, 15 basis points lower than the increased rate of interest.
(Also read: SBI hikes lending rate for first time since April 2016)
Likewise, the rate of interest for the short duration term deposits has been raised by up to 50 basis points.
The ultra-short duration term deposits (7 days to 45 days) will now earn a rate of interest of 6.25 per cent against 5.75 per cent earlier. The deposits made for 46 days to 179 days will continue to earn a rate of interest of 6.75 per cent. There is no change in the deposits of this tenor.
The deposits made for six months (180 days) to seven months (210 days) will draw a rate of interest of 6.85 per cent against the earlier rate of 6.75 per cent, only 10 basis points lower than the new rate.
|Tenors||Existing for Senior Citizens with effect from 01.11.2017||Revised for Senior Citizens with effect from 28.02.2018|
|7 days to 45 days||5.75||6.25|
|46 days to 179 days||6.75||6.75|
|180 days to 210 days||6.75||6.85|
|211 days to less than 1 year||6.75||6.9|
|Above 1 year to 455 days||6.75||6.9|
|456 days to less than 2 years||6.75||6.9|
|2 years to less than 3 years||6.5||7|
|3 years to less than 5 years||6.5||7|
|5 years and up to 10 years||6.5||7|
However, one must remember that the interest rate payable to State Bank of India (SBI) Staff and SBI pensioners will be 1 per cent above the applicable rate. The new rates of interest will be made applicable to the new deposits and in case of renewals of maturing deposits.