Savings Bank Interest Rate
Deregulated by RBI
Previously on
May 03,2011, Savings Bank Interest Rate was increased of 0.5 % point from 3.5
per cent to 4.0 per cent per annum; But now vide its Notification
No.RBI/2011-12/233, DBOD.dir.BC.No.42/13.03.00/2011-12 dtd. October 25, 2011,
the RBI has ended the era of controlled interest rate regime by deregulating
the savings bank deposit interest rate with effect from October 25, 2011.
Banks
are now free to determine their savings bank account interest rate instead of
the 4% that was fixed for all banks previously, subject to the following
conditions:
(i) First,
each bank will have to provide a consistent interest rate on savings bank
deposits up to Rs. 1 lakh, irrespective of the amount in the account within
this limit
(ii)
Second, for savings bank deposits over Rs.1 lakh, a bank may provide
differential rates of interest, if it so chooses. However, there should not be
any discrimination from customer to customer on interest rates for similar
amount of deposit.
For more details
regarding savings account interest rate deregulation guidelines / notification,
please check @ http://rbi.org.in/scripts/NotificationUser.aspx?Id=6779&Mode=0
Already
following five banks have announced a hike in their interest rates:
S.No.
|
Name
|
Under Rs. 1 lakh
|
Over Rs. 1 lakh
|
W.E.F
|
1
|
Indus Ind Bank
|
5.50%
|
6.00%
|
1-Nov-11
|
2
|
Kotak Mahindra
|
5.50%
|
6.00%
|
1-Nov-11
|
3
|
Ratnakar Bank
|
5.50%
|
5.50%
|
1-Nov-11
|
4
|
Karnataka Bank
|
5.00%
|
5.00%
|
19-Dec-11
|
5
|
Yes Bank
|
6.00%
|
7.00%
|
22-Dec-11
|
CASA (current
account and savings account) deposits of these banks registered a substantial
growth in the final quarter. It is obvious and evident that customer-base has
been increased through switching banks that provide higher returns;
So now it is
clear that your Savings amount in banks will fetch you more return than 4% it fetched you earlier.
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