SBI slashes lending rates and fixed deposit interest rates, effective next week

New Delhi (The Uttam Hindu) : The country's largest public sector bank, State Bank of India (SBI), has reduced interest rates on loans and fixed deposits (FDs). The new rates will take effect on Monday.

SBI's decision comes after the Reserve Bank of India (RBI) reduced the repo rate by 25 basis points from 5.50 percent to 5.25 percent earlier this month. SBI also reduced its Margin Cost of Funds Based Lending Rates (MCLR) by 5 basis points, or 0.05 percent. This is the rate at which banks determine loan interest rates. This reduction impacts interest rates on all types of loans.

SBI has reduced the overnight and one-month MCLR rates from 7.90 percent to 7.85 percent. The three-month MCLR has been reduced from 8.30 percent to 8.25 percent. The six-month MCLR has been reduced from 8.65 percent to 8.60 percent. The bank has also reduced the one- and two-year MCLR rates from 8.75 percent to 8.70 percent. The three-year MCLR rates have been reduced from 8.85 percent to 8.80 percent.

The bank has also reduced interest rates on FDs. According to SBI's new rates, the interest rate for an average individual on two to three year FDs of less than Rs 3 crore will now be 6.40 percent, which was earlier 6.45 percent. For senior citizens, the interest rate for the same period will now be 6.90 percent, which was earlier 6.95 percent. The bank has also reduced the interest rate on its special 444-day FD Amrit Varsha from 6.60 percent to 6.45 percent.

According to SBI, now general individuals will get an interest rate of 3.05 percent on FDs of 7-45 days. 4.90 percent on FDs of 46-179 days, 5.65 percent on FDs of 180-210 days, 5.90 percent on FDs of 211 days to less than one year. The interest rate for the period from one year to less than two years will be 6.25 percent. Whereas, the interest rate on the period of three to less than five years will be 6.3 percent. The interest rate on FDs of five to 10 years will be 6.05 percent. Apart from this, senior citizens are being given an additional interest of 0.50 percent by the bank.