SBI reduces the interest rate on saving accounts deposit to 2.70%

Tags: Economy/Finance

India’s largest commercial bank State Bank of India (SBI) has reduced the interest rate on savings accounts by a marginal 5 basis points to 2.70 per cent effective from 15 October 2022.  100 basis points is equal to 1%.

The new saving rates are applicable on balances of less than Rs 10 crore, on which the bank earlier offered 2.75 per cent per annum interest.

However, on saving account balances of Rs 10 crore and above, SBI has increased the deposit rates to 3 per cent per annum from 2.75 percent earlier.

The lowering of rates on savings accounts by SBI comes at a time when the peer lenders have been raising deposit rates to mobilize funds.

Interest Rates on Saving account 

Reserve Bank of India deregulated the interest rate  on the saving accounts from 25 October 2011. It means that the interest rates on the savings account is decided by banks themselves, not RBI.

There is no minimum or maximum interest prescribed by the RBI for the banks . 

Bank’s can offer extra interest to certain persons

RBI has allowed the Scheduled Commercial Banks to offer extra  upto 1% interest to the following persons/groups ;

• a member or a retired member of the bank’s staff, either singly or jointly with any member or members of his/her family; or
• the spouse of a deceased member or a deceased retired member of the bank’s staff; and
• an Association or a fund, members of which are members of the bank’s staff;
• on deposits of Chairman, Chairman & Managing Director, Executive Director or such other Executives appointed for a fixed tenure.

State Bank of India 

It is the largest  commercial bank in India and is owned by the Government of India.

It has over 22,000 branches, 71,968 Banking Correspondents outlets.

It has 229 offices/branches in 31 foreign countries. Amongst all the Indian banks, SBI has the largest number of branches/offices outside India.

Chairman of SBI: Dinesh Kumar Khara 

Managing Director of SBI : Alok Kumar Choudhary 

Headquarters: Mumbai

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