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The RBI cut the repo rate by 0.25% to 6%, leading banks like HDFC, ICICI, and SBI to lower FD and loan rates. Senior citizens benefit from SBI’s ‘We Care’ scheme
HDFC offers the highest short-term interest rate of 7.25% for 18 to 21 months, ICICI offers 7.25% for 15 to 18 months. (Representative/Shutterstock)
In a recent development, the Reserve Bank of India (RBI) has reduced the repo rate by 0.25% to 6%, marking the second rate cut. This reduction has prompted banks to lower their deposit and loan interest rates.
Here’s a look at the current interest rates offered by major banks like HDFC Bank, ICICI Bank, and State Bank of India (SBI) on Fixed Deposits (FD) of less than Rs 3 crore.
Interest Rates At HDFC Bank
HDFC Bank now offers lower interest rates on short-term fixed deposits. For tenors of 7 to 29 days, the interest rate is 3%, for 30 to 45 days, it’s 3.50%. For 46 to 89 days, the rate is 4.50%, and for 90 days to 6 months, it remains at 4.50%. Deposits for 6 months to 9 months attract an interest rate of 5.75%, and for 9 months to 1 year, it’s 6%. For 1 year to 15 months, the rate is 6.60%, for 15 months to 18 months, it’s 7.10%, and the highest rate of 7.25% is offered for 18 months to 21 months.
Longer tenors of 21 months to 3 years, 3 to 5 years, and 5 to 10 years attract a 7% interest rate. Senior citizens benefit from an additional 0.50% interest for all tenors, resulting in 7.75% for 18 to 21 months, for example.
Interest Rates At ICICI Bank
ICICI Bank provides 3% interest for 7 to 29 days, 3.50% for 30 to 45 days, 4.25% for 46 to 60 days, and 4.50% for 61 to 90 days. For 91 to 184 days, the rate is 4.75%, for 185 to 270 days, it’s 5.75%, and for deposits from 271 days to 1 year, it is 6%. The highest rates are 6.70% for 1 year to 15 months and 7.25% for 15 to 18 months. For 18 months to 2 years, the rate is 7.25%, for 2 to 5 years, it’s 7%, and for 5 to 10 years, it’s 6.90%. The 5-year tax-saving FD offers 7%. Senior citizens enjoy an additional 0.50%, making the rate 7.75% for 15 to 18 months.
Interest Rates At SBI
SBI offers an interest rate of 3.50% for 7 to 45 days, 5.50% for 46 to 179 days, 6.25% for 180 to 210 days, and 6.50% for 211 days to one year. The highest rate is 6.70% for 1 year to 2 years, 6.90% for 2 to 3 years, 6.75% for 3 to 5 years, and 6.50% for 5 to 10 years. Senior citizens receive an extra 0.50% interest across all tenors. Under the ‘SBI We Care’ scheme, FDs for 5 to 10 years offer an additional 1% interest, resulting in 7.50%.
What Does Reduction In Repo Rate Mean
The reduction in the repo rate means banks find it harder to secure loans from the RBI, leading to lower FD and loan interest rates. For customers, this means reduced profits from FDs but potentially lower EMIs on loans. For instance, lower home loan interest rates result in lower monthly payments.
Benefits For Senior Citizens
Senior citizens benefit from higher interest rates across these banks, with HDFC and ICICI offering 0.50% more and SBI offering 1% more for 5 to 10 years under the ‘We Care’ scheme, providing a substantial income boost.
Best Interest Rates
To summarise, HDFC offers the highest short-term interest rate of 7.25% for 18 to 21 months, ICICI offers 7.25% for 15 to 18 months, and SBI offers 6.90% for 2 to 3 years, with the ‘We Care’ scheme providing up to 7.50% for senior citizens.
Customers should choose a plan based on their needs and keep an eye on interest rate changes to invest in FDs at the optimal time.
