Fresh FD depositors, renewals to fetch lower interest as SBI slashes rates again
For the second time in less than a month, the country’s largest lender State Bank of India (SBI) on Wednesday snapped the interest rates on Fixed Deposits (FD) for certain tenors for fresh depositors and renewals of maturing deposits. The cut is applicable to short-term FDs with tenures between seven to 45 days. The revised new rates came into effective from March 10, 2020.
After the latest revision, the FDs will now fetch 4% as against the previous 4.5%. The revised rates will also affect FDs between one year to less than five years and those between five years and up to 10 years and fetch the investors 5.9%, from the earlier 6%.
The SBI had earlier cut interest rates by 50 basis points on FDs for the general public on February 10.
The FD rates for senior citizens will, however, remain the same. They will continue to get 50 basis points higher interest rates than offered to general masses. These rates are applicable to retail FDs of less than Rs 2 crore. With the SBI lowering its interest rates, other banks are also expected to revise their interest rates soon.
On Wednesday, the SBI also cut its Marginal Cost of fund-based Lending Rate (MLCR) by up to 15 basis points across various tenors making it effective from March 10. The bank has reduced its one-year MCLR by 10 basis points to 7.75% from 7.85% earlier.