State Bank of India (SBI) account holders get interest at a lower rate on their balance from Wednesday. The country's largest lender by assets has lowered the interest on savings deposits with effect from April 15. An interest rate of 2.75 per cent is now applicable on SBI savings deposits - the balance in a State Bank of India savings account. Earlier, the bank had provided a return of 3 per cent on savings account deposits, higher by 25 basis point - or 0.25 percentage point - compared to the current rate.
SBI Interest Rates For Savings Accounts
The new interest rate for SBI's savings accounts comes within two weeks of the Reserve Bank of India lowering the repo rate - or the key interest at which the RBI lends funds to commercial banks such as SBI - by 75 basis points to 4.40 per cent, in an emergency move to strengthen the financial system against the economic fallout from the deadly coronavirus (COVID-19) pandemic.
(Also Read: RBI Eases Loan Repayment Rules. How It Helps You)
In March, State Bank of India lowered the interest rate on savings bank accounts to 3 per cent, rationalising the returns on savings bank deposits. Before that, SBI paid offered different interest rates for savings accounts with balance up to Rs 1 lakh and those with a higher balance.
State Bank of India adjusts the interest rates applicable to its products from time to time. For example, it lowered the interest rates on term loans by 35 basis points across tenors with effect from April 10, making its loans cheaper. That marked the eleventh cut in the bank's lending rates in a row.