State Bank Of India

State bank of India (SBI) has introduced 2 tier saving bank interest rate with effect from July 31, 2017. While balance above Rs 1 crore will continue to earn interest at 4% per annum, interest at 3.5% per annum shall be offered on balances of Rs 1 crore and below.

The decline in the rate of inflation and high real interest rates are the primary considerations warranting a revision in the rate of interest on savings bank deposits.

Further, the bank had cut the MCLR by 90 basis points effective January 1, 2017, on the strength of large inflows in savings and current accounts during the demonetisation period in the month of November and December, 2016. There has been significant outflow of CASA deposits since then. The revision in saving bank rate would enable the bank to maintain the MCLR at the existing rates, benefitting a large segment of retail borrowers in SME, agriculture and affordable housing segments.