SBI eases FD rates by 10 basis points after RBI policy change

SBI decreased its fixed deposit interest rates after the RBI lowered its benchmark rate by 25 basis points last week. Lending rates tied to the marginal cost of funds-based lending rate (MCLR) have not been reduced because the bank's cost of funds remains too high to make reductions meaningful.

The bank reduced its external benchmark-linked lending rate (EBLR) by 25 basis points after the repo rate cut. The RBI rate cut for home loans and personal loans will decrease for borrowers. The bank implemented revised deposit interest rates for two main fixed deposit durations starting April 15.

Businesses can expect lower borrowing costs because select tenors will see deposit rates decrease by 10 basis points which will lead to reduced MCLR rates in the near future. SBI's recent move will probably trigger comparable actions from other public sector banks.

HDFC Bank decreased its savings account interest rates by 25 basis points which resulted in a new base rate of 2.75%. Accounts that have balances over ₹50 lakh now receive an interest rate of 3.25%. The Bank of India announced its decision to terminate its Special Deposit Scheme. The private bank lowered its SBI deposit rates before the RBI updated its repo rates earlier this month.

The interest rate for deposits held between 1 year and less than 2 years has been adjusted downwards to 6.7% for general customers and 7.2% for senior citizens from the previous rates of 6.8% and 7.3%.

Deposits that have a duration between 2 years and less than 3 years now receive the same revised rates. In the extended tenor category rates fall from 7% to 6.9% and from 7.5% to 7.4%. None of the remaining deposit maturities have experienced changes from their June 15, 2024 levels.