Interest drop of various public sector banks
PNB lowers rates on savings account deposits by 0.5%
The rate of interest on savings bank deposit has been reduced with effect from July 1, 2020, Punjab National Bank said.
Bank currently have sufficient liquidity but demand remains at lower side due to COVID-19 pandemic. This results in downfall in the interest income of the bank. Less demand has created the difference in interest earned on loan and interest given on Savings deposits.
Interest is paid at the rate of 3% per annum where end of the day balance is up to Rs. 50 Lakhs. Whereas, interest is paid at the rate of 3.25% per annum where end of the day balance is Rs. 50 Lakhs and above. As per the report, Interest shall be credited at end of each quarter i.e. February, May, August and November.
Axis Bank Ltd cut interest rate on savings account by 0.25%
Private Sector lender Axis Bank Ltd had lowered down its rate of interest on Savings bank deposits to 3%. Interest paid to Savings Account for balance up to Rs. 50 Lakhs is 3%. Whereas, for the balance of Rs. 50 Lakhs and above the interest rate is 3.5%
This decision comes after the announcement made by RBI to cut Repo Rate by 40 basis points to 4%. Axis bank hs reported the loss of Rs. 1,388 Crore in the fourth quarter. However, Bank’s average savings deposit grew to ₹1.60 lakh crore for fiscal year 2019-2020 compared to ₹ 1.4 lakh crore last year.
SBI cuts savings deposit rates by 5 bps to 2.7%
India’s largest Public Sector Bank, State Bank of India has lowered its Savings deposit rate to further 2.7%. This interest rate will be effective on all savings deposit from 31st May.
This reduction is the second cut savings deposit rates in FY21 after the last reduction of 0.25% in April,2020. On March 11, the bank had reduced its interest rates to 3% for all customers. However, it use to pay 3.25% for balance up to Rs. 1 Lakhs and 3.25% for balance of Rs. 1 Lakhs and above.
State Bank of India has also reduced it FD rates this Quarter. On 27th May, SBI has reduced its fixed deposit rates to 40 basis points i.e. 0.4%. SBI latest FD rates will be effective from 27th May,2020 as mentioned in State Bank of India website. You can see the new FD rates from here
Interest drop of various public sector banks.