SBI to keep savings account interest rate unchanged

The country's largest lender, the State Bank of India (SBI) announced on Friday that it will not not reduce interest rate on its savings accounts. At the same time though the bank stated that it will cut rates on fixed deposits (FDs) again with effect from August 26, 2019.This a good news for savings account holders of the bank since with effect from May 1 it was announced that SBI will link the interest rate of savings accounts having balances above Rs 1 lakh to the repo rate. Post the rate cut by RBI, these account holders were supposed to earn 2.65 per cent. However, according to SBI's press release issued today, it announced that it will not reduce interest rate on these accounts any more. SBI savings accounts with balances above Rs 1 lakh will continue to earn 3 per cent. And accounts with balances up to Rs 1 lakh will continue to earn 3. 50 per cent.The Reserve Bank of India (RBI), in its third bi-monthly policy in August had reduced repo rate by 35 bps (from 5.75 per cent to 5.40 per cent) for the financial year 2019-20. This is the third rate cut for the current FY, taking the quantum of rate cuts to 85 bps. With regards to the bank's FDs, with effect from August 26, interest rates will be lower by 10-50 bps across tenures for retail customers. For bulk depositors, the rates are reduced between 30 bps and 70 bps across tenures.Fixed deposit interest rate for individuals Tenors Existing for Public w.e.f. 01.08.2019 Revised For Public w.e.f. 26.08.2019 7 days to 45 days 5.00 4.50 46 days to 179 days 5.75 5.50 180 days to 210 days 6.25 6.00 211 days to less than 1 year 6.25 6.00 1 year to less than 2 year 6.80 6.70 2 years to less than 3 years 6.70 6.50 3 years to less than 5 years 6.60 6.25 5 years and up to 10 years 6.50 6.25 Source: Bank's websiteFixed deposit interest rate for senior citizens Tenors 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 5.50 5.00 46 days to 179 days 6.25 6.00 180 days to 210 days 6.75 6.50 211 days to less than 1 year 6.75 6.50 1 year to less than 2 year 7.30 7.20 2 years to less than 3 years 7.20 7.00 3 years to less than 5 years 7.10 6.75 5 years and up to 10 years 7.00 6.75 Source: Bank's website"In view of the falling interest rate scenario and surplus liquidity, SBI realigns its interest rate on Term Deposits w.e.f. 26th August 2019," SBI press release stated.

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