State Bank of India or SBI, country's largest lender, announced a reduction in its fixed deposit (FD) interest rates across all maturities. The bank said its FD rates will be reduced by 10-50 basis points (or 0.10-0.50 percentage point) across tenors in the retail segment, and bulk segment will see a reduction of 30-70 basis points (or 0.30-0.70 percentage point). The new rates will take effect on August 26. "In view of the falling interest rate scenario and surplus liquidity, SBI realigns its interest rate on fixed deposits," the bank said in a statement.
The bank will now offer an interest rate of 4.5 per cent to general public and 5 per cent to senior citizens on fixed deposits of 7-45 days. Currently, the public sector bank pays interest at the rate of 5 per cent and 5.5 per cent to the general public and senior citizens respectively.
Here are revised SBI's fixed deposit (FD) interest rates for FDs below Rs. 2 crore which will be effective from August 26:
|Tenors||Existing for Public w.e.f. 01.08.2019||Revised For Public w.e.f. 26.08.2019||Existing for Senior Citizens w.e.f. 01.08.2019||Revised for Senior Citizens w.e.f. 26.08.2019|
|7 days to 45 days||5%||4.5%||5.5%||5%|
|46 days to 179 days||5.75%||5.5%||6.25%||6%|
|180 days to 210 days||6.25%||6%||6.75%||6.5%|
|211 days to less than 1 year||6.25%||6%||6.75%||6.5%|
|1 year to less than 2 year||6.8%||6.7%||7.3%||7.2%|
|2 years to less than 3 years||6.7%||6.5%||7.2%||7%|
|3 years to less than 5 years||6.6%||6.25%||7.1%||6.75%|
|5 years and up to 10 years||6.5%||6.25%||7%||6.75%|
Fixed deposit interest rates are subject to change from time to time. Earlier, SBI revised its FD rates on August 1. The Reserve Bank of India's Monetary Policy Committee (MPC) had cut its repo rate by 35 basis points this month, in its fourth downward revision so far this year. Repo rate is the interest rate at which the RBI lends money to commercial banks.
State Bank of India, on the other hand, has decided not to reduce the savings bank interest rate further and hold the same at the existing level of 3 per cent for customers with balances above Rs 1 lakh. Customers with savings balance up to Rs 1 lakh will continue to get the rate of interest at 3.50 per cent, the bank said.