SBI cut its interest rate offering on savings bank deposits upto Rs. 1 crore from 4% to 3.5% and on similar lines, Bank of Baroda also lowered its interest rate on savings bank account with deposits upto Rs 50 lakh by 50 basis points to 3.5% p.a.
The rates shall apply from August 5, 2017. In a regulatory filing the bank said, "
"We wish to inform you that it has been decided to introduce a 2-tier savings bank interest rate (from) August 5." Nonetheless, for deposits over Rs. 50 lakh balance, the interest rate shall continue to be 4%.
However, for balance above of Rs 50 lakh, the bank has retained the rate at 4 percent. In line with two of the major banks cutting down on interest rate on savings account, more public-run and private sector banks are likely to follow suit.