SBI Fixed Deposit Interest Rate: The State Bank of India has notified a hike in the fixed deposit (FD) interest rates for its account holder, days after the HDFC Bank made a similar move. As per the bank’s website, the hike has been done on deposits for short terms. This comes months after the RBI kept its repo rates unchanged. The State Bank of India, or SBI, has announced this increase in interest on fixed deposits after a long gap. The latest change was announced on the bank’s website, via a chart which displays all the plans for fixed deposits.
SBI FD Interest Rate Hike– Details
The State Bank of India, which is the largest public lender in the country, announced on its website that the new rates of interest for its FDs will be applicable for deposits below Rs 2 crore. This has to be done for deposits with a tenure of one year to less than two years. The rates have been hiked by 10 basis points or 0.10 per cent.
After the SBI FD interest rate hike, general public will get a 5.10 per cent return, up from 5 per cent, on their fixed deposits below Rs 2 crore. On the other hand, senior citizens will get 5.6 per cent for the same, up from 5.5 per cent earlier. The rate hikes came into effect from January 15, Saturday. The last time interest rates were revised was January 8 last year, according to the public lender’s website.
However, in December last year, the State Bank of India had notified on its website a rise in its base rates by 10 bps or 0.10 per cent. From December 15, 2021, the new base rate of 7.55 per cent per annum came into effect. The base rate, other than acting as a reference rate for borrowers, also indicates the overall rate of interest in the economy. Therefore, it can be said that the regime of low interest rates is ending.
The rising interest rates is likely to come as good news for depositors who have been earning one of the lowest rates of interest for almost 20 years. If the base rate rises further, we are likely to see a few more increases in rates of interest going forward.
The SBI’s FD interest rate hike comes close in heels with that of the HDFC Bank. This also signals that banks are slowly giving into the trend of hiking interest rates on fixed deposits.
The private sector lender HDFC Bank, in a recent update, has revised its interest rates on fixed and recurring deposits, which are of less than Rs 2 crore. According to the bank’s official website, the new rates are effective from January 12, 2022. The HDFC Bank said that it has increased the interest rates of deposits with maturity above two years by 5-10 basis points
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