In the current liquidity crunch, this move by the bank seems to mobilize larger funds for medium term lending.
As the target for medium-term inflation of Reserve Bank of India (RBI) is above 5, the bank is now offering to pay higher rates for similar category of deposits.
The new rate would be effective from July 18, it said.Last month, the central bank had left key policy rate unchanged in its no deposit free spins starburst bid to rein in inflation.While deposit rates for maturities of three to five years was lowered.25, those for five years and above were cut.50.Until a few years ago, FD rates were"d in either number of months or years, but icici Bank took the initiative to launch specific days FD with launch of 390/ 590/ 890 days.With the turmoil in US financial market and its impending effect on India, Indian customers are now more inclined to invest in public sector banks rather than private sector or foreign bank, as such the new scheme may prove to be a hit in todays.This 1000-days deposit scheme is a new launch of SBI and will come into effect from October.
Today, SBI has spread its arms around the world and has a network of branches spanning all time zones.
For the same maturity senior citizens would get.5 percent additional interest.
The repo rate, at which the Reserve Bank of India lends to banks was retained.
Being the largest lender, SBI has a vast domestic network of over 9000 branches (approximately 14 of all bank branches) and commands one-fifth of deposits and loans of all scheduled commercial banks in India.
Among private and foreign sector banks, only TamilNadu Mercantile Bank offers10.5 for period 1-3 years.Interest rate on fixed deposits between 7-179 days has been reduced to 7 from.5, SBI said in a statement.When compared with other banks, the.5 interest rates looks attractive as no other public sector bank is offering more than.75 for a period during 2 years to 4 years.However, for the 1,000 days deposit category the interest rate will.5 and for rest of the six categories, the bank has not made any changes singapore fixed deposit rates history in its rates.Senior citizens would be given a higher 11 interest under the new deposit scheme.Besides, an additional 25 basis points over the card rates will be paid on a single term deposit of Rs 15 lakh and above (but less than Rs 1crore) for a period of 181 days to less than 2 years.Now the bank has created three slabs within two years to three years category.Earlier, the bank had just one slab for the period between two years to three years and was paying.5 for the same.The cash reserve ratio for banks was kept unchanged.
SBI last reduced its fixed deposit rates in February by up.5 on select maturities.
After announcing the creation of 1000-day Fixed Deposit giving an interest rate.5, State Bank of India has proved its aggressiveness in taking lead over others in garnering public funds.
The bank offers services like merchant banking, fund management, factoring services, and primary dealership in government securities, credit cards and insurance.