Banks change new interest rates on recurring deposits

November 01, 2022

Ever since the Reserve Bank has gone on a rate hiking spree starting May this year, short to medium term interest rates on bank deposits like RDs and FDs have gone up considerably. Based on an assessment of the macroeconomic situation and its outlook, the central bank MPC in its October policy meet decided to increase the policy repo rate by 50 basis points to take the repo rate to 5.9 percent.

In line with the high interest rate regime, lenders are now offering RD subscribers interest rates in the range of 4.25 percent to 6.25 percent. Most major banks in India offer RDs with a term that often ranges between 6 months to 10 years.

State Bank of India has raised interest rates on RDs effective October 22, 2022. The bank offers an interest rate ranging from 6.10 percent to 6.25 percent on RDs maturing in 1 year to 10 years.

Interest rate on RDs of tenure of 1 year to less than 2 years will be 6.10 percent, while subscribers opting for a tenure of 2 years to less than 3 years will get 6.25 per-cent interest. Those who opt for 3 years to less than 5 years will get 6.10 percent rate and subscribers choosing a tenure of 5 years and up to 10 years may fetch 6.10 per-cent interest.

Private sector HDFC Bank has hiked its interest rates on recurring deposits across all tenors. On deposits maturing in 6 months, the bank offers 4.50 percent and on deposits maturing in 9 months, HDFC Bank gives 5.25 percent. Deposits maturing in 12 months will now fetch an interest rate of 6.10 percent, and those maturing in 15 Months to 24 Months will now fetch an interest rate of 6.15 percent. Deposits maturing in 90 Months to 120 Months will now fetch an interest rate of 6.20 percent. These rates are effective October 26, 2022.