State Bank of India, the largest commercial bank in the country, has introduced a 2-tier saving bank interest rate w.e.f. July 31, 2017. While the balance above Rs 1 crore will continue to earn interest at 4% per annum, interest at 3.5% rate will be offered on balances of Rs 1 crore and below, SBI informed BSE Ltd today.
The decline in the rate of inflation and high real interest rates are the primary considerations for warranting a revision in the rate of interest of savings bank deposits, it said.
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 a significant outflow of CASA deposits since then. The revision in savings 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.
It may be recalled that SBI had recently reduced charges for NEFT and RTGS transactions by up to 75%, effective from July 15, 2017. The reduced charges were applicable on the transactions done through the internet banking (INB) and mobile banking (MB) services offered by the bank. Additionally, the bank had also waived charges for fund transfer of up to Rs 1,000 done through Immediate Payment Service (IMPS) effective 1st July 2017.
As on 31st March, 2017, SBI had 3.27 crore Internet Banking customers and nearly 2 crore Mobile Banking customers. Along with customer convenience, this initiative will attract more customers towards transacting digitally, the bank had said in a press release.