Those banking on fixed deposits (FD) of the State Bank of India (SBI) will have to settle for a little less now. Effective February 10, the SBI FD interest rates have been cut across all durations of deposit above 181 days. The 1-year FD rate of interest will now stand at 6 per cent as against 6.10 per cent earlier. In spite of the RBI keeping the repo rate constant, the interest rate movement seems to be on the downtrend.
The current rate of interest on 1-year SBI FD is 6 per cent per annum, down from 6.10 per cent per annum. The same rate of interest is applicable for deposits of ‘1 year to less than 2 years’, ‘2 years to less than 3 years’, ‘3 years to less than 5 years’ and ‘5 years and up to 10 years.’ For senior citizens, the additional interest rate of 0.5 per cent will continue as before.
The immediate impact will be on those depositors who have their FDs coming up for renewal in the coming days or weeks.
The SBI FD rates on deposits with lesser duration – 7 days to 179 days – however, continues to be the same as earlier. The new rates of interest will apply to fresh deposits and renewals of maturing deposits. The interest rates on “SBI Tax Savings Scheme 2006(SBITSS)” Retail Deposits and NRO deposits shall be aligned as per the new rates for domestic retail term deposits.
The rate applicable to all Senior Citizens and SBI Pensioners of age 60 years and above will be 0.50% above the rate payable for all tenors to resident Indian senior citizens i.e. SBI resident Indian Senior Citizen Pensioners will get both the benefits of Staff (1%) and resident Indian Senior Citizens (0.50%).
Earlier, there was a revision made by SBI in the savings bank account rate of interest. The interest rate on savings bank deposits effective September 1, 2019, with balances up to Rs. 1 lakh was 3.5 per cent. However, from November 1, 2019, the interest rate on savings bank deposits with balances up to Rs. 1 lakh is 3.25 per cent. The interest rate on savings bank deposits with balances above Rs. 1 lakh continues to be 3 per cent per annum (2.75 per cent below RBI’s Repo Rate, with a minimum of 3 per cent ) for the entire balance.