As informed earlier by the public-sector lender, with effect from 1 November, interest rates on savings bank accounts at the State Bank of India (SBI) will be lowered.
Earlier this month, along with a revision in its fixed deposit interest rates, SBI announced that it would lower interest rates on savings accounts with balance less than Rs 1 lakh to 3.25 percent from the current 3.50 percent.
Interest rates on balances over Rs 1 lakh
The country's largest commercial bank has kept the interest rate on saving bank accounts with balance above Rs 1 lakh unchanged at 3 percent.
SBI had introduced a new mechanism for interest rates on large savings deposits starting 1 May, wherein the interest rates were linked to RBI's (Reserve Bank of India) repo rate. For balances above Rs 1 lakh interest rate was set at 2.75 percent below RBI's repo rate, with a minimum of 3 percent on the entire balance.
RBI has cut its repo rate by 1.35 percent in total at 5 consecutive bi-monthly monetary policy reviews to push growth in the country's economy. Its next meeting is scheduled for 5 December.
On 4 October, the central bank reduced its repo rate by 25 basis points to 5.15 percent.