State Bank of India’s decision to hike interest on fixed deposits comes ahead of RBI’s fifth bi-monthly monetary policy review this year.
State Bank of India hiked interest rate on fixed deposits soon after HDFC Bank and ICICI Bank. (Photo: Reuters)
By India Today Web Desk: The country’s largest public lender State Bank of India (SBI) on Wednesday (November 28) hiked interest rates on fixed deposits (FDs) with maturity periods ranging from one-two years. The latest revision in FD interest rates comes after other major banks including ICICI Bank and HDFC Bank hiked rates.
The public lender said on its website that SBI FD interest rates have been increased by 0.05-0.10 per cent. A single basis point corresponds to 0.01 per cent. The lender also informed on its website that the change in FD interest rates will be applicable to all deposits below Rs 1 crore from today.
People generally invest in FDs as they are safe, especially those offered by public sector banks such as Punjab National Bank (PNB), State Bank of India and more. Financial advisers suggest individuals invest in an FD as it offers a fixed rate of interest on deposits as it is often higher than interest compared to a regular savings accounts.
Check fresh rates
After the latest revision, the bank is now offering 6.80 per cent interest rate on those FDs which have a maturity period of one or two years; the previous rate was at 6.7 per cent. The SBI FD interest ratewith a maturity period of one or two years for senior citizens has also gone up to 7.30 per cent.
Check the chart below
|Maturity period||Past rates (%)||Present rates (%)|
|7 days to 45 days||5.75||5.75|
|46 days to 179 days||6.25||6.25|
|180 days to 200 days||6.35||6.35|
|211 days to less than 1 year||6.40||6.40|
|1 year to less than 2 years||6.70||6.80|
|2 years to less than 3 years||6.75||6.80|
|3 years to less than five years||6.80||6.80|
|5 years to 10 years||6.85||6.85|
Individuals should note that the public lender has kept interest rate unchanged for FDs with other maturity tenures. Not just SBI but almost all banks both private and public offer FDs with different maturities, ranging from seven days to a decade.
SBI FDs with a maturity of seven days to 45 days has been kept unchanged at 5.75 per cent; those with maturity periods between 46 days and 179 days have an FD interest rate fixed at 6.25 per cent.
The interest rate on SBI FDs with a maturity of 180 days to 210 days also remains unchanged at 6.35 per cent. Finally, the interest rate on SBI FDs with a maturity of 211 days remains fixed at 6.40 per cent.
For SBI FDs with higher maturity tenures from three years to less than five years and from five to 10 years, the interest rate remains fixed at 6.80 per cent and 6.85 per cent respectively.
For senior citizens, the bank also offers 50 basis points or an additional 0.5 per cent interest rate for all fixed deposits across all its maturity tenures.
In addition, those who have FDs with a minimum lock-in period of five years are eligible for tax benefits under Section 80C (deduction on investments) of the Income Tax Act.