HDFC Bank has reduced its fixed deposit rates, capping them at 6.45% for retail deposits of less than Rs 3 crore, following the 25 basis point repo rate cut by the Reserve Bank of India (RBI) in December. State Bank of India had also reduced its fixed deposit rates earlier this month.
Targeted Cuts
Effective December 17, the private sector lender offers a peak rate of 6.45% for tenors between 18 months and just under three years. The bank reduced the interest rates by 15 basis points on tenures of 18 months to less than 21 months for both general and senior citizens. Senior citizens can earn up to 6.95% for these maturities. One-year deposits carry an interest rate of 6.25% for regular customers and 6.75% for senior citizens, while longer-term deposits of five to ten years offer a lower rate of 6.15%.
Shift in Strategy
The largely flat rate structure across medium-term tenors, along with lower rates at the longer end, suggests the bank is not aggressively chasing long-duration retail deposits. For bulk deposits between Rs 3 crore and less than Rs 5 crore, HDFC Bank offers peak rates of around 6.40%, with senior citizens earning up to 6.90%.