- Date : 03/07/2022
- Read: 4 mins
Deposit rates at top banks after RBI hike of repo rates
RBI has recently hiked the repo rate by 90 bps. They hiked the repo rate by 40 bps in an unscheduled policy meeting in May 2022. After that, they hike the repo rate by 50 bps in a scheduled policy meeting in June. An increase in repo rates increases the FD rates as well. The FD rates offered at various banks like the ICICI bank, HDFC Bank, PNB, Indian bank, etc. have increased. This is good news for savers.
An increase in repo rates results in an increase in the cost of funds for the banks. In response, they hike the loan rates. Also, they increase the deposit rates that they pay on FD as they can afford to pay more. Also, they need to attract savers.
Related: https://www.tomorrowmakers.com/other-investments/bank-fd-vs-fd-offered-nbfc-infographic2
Deposits
RBI repo hikes have allowed the interest rates on deposits to increase. This has generated the interest of people to save money in fixed deposits or savings accounts to earn some interest.
The world is battling with record inflation levels, and this is resulting in an increase in the interest rates by the Central banks worldwide. This is resulting in an increase in the policy rates worldwide. India is no exception to this.
Rates of interest are likely to go up for new retail borrowers. Borrowers who already have interest rates that are linked to the repo rate will be affected as well.
After the RBI raised the repo rate, several banks raised their interest rates on lending benchmarks, fixed deposits, and savings accounts.
ICICI Bank:
ICICI Bank changed its external benchmark lending rate in response to the change in the repo rate by the RBI. The deposit rates at ICICI bank are 5.35% to 5.85%, depending upon the deposit amount and whether the depositor is a senior citizen. ICICI Bank Savings account interest rate is at 3% for EOD balance below Rs 50 lakhs. It is 3.5% for EOD balance above Rs 50 Lakhs. This means that they have increased the savings account rates by 50 bps after the interest rate hikes.
Punjab National Bank:
PNB raised its repo-linked lending rate (RLLR) by 90 basis points. Existing customers will have to follow the new RLLR starting July 1, and new customers will have to do so immediately. The deposit rates at PNB are 5.2% for Indian citizens and 5.7% for senior citizens for the one-year term deposit. The savings rate in PNB is 2.7% for EOD balances below Rs 10 Lakhs and 2.75% for EOD balances above Rs 10 Lakhs. The bank has hiked the savings account rate by 0.05% in line with RBI repo rate hikes.
The Baroda Bank
The interest rates on loans went up immediately at the bank. The bank said on its website that the BRLLR for retail loans is 7.45 percent, the sum of the current repo rate of 4.90 percent, a markup of 2.55 percent. For the deposit rates, the Bank of Baroda's interest rate on term deposits for one year is 5%. For senior citizens, the interest rate is 5.5%. The savings account interest rate is 2.75% at the Bank of Baroda. The bank has hiked the savings account rate by 0.05% in line with RBI repo rate hikes.
HDFC Bank:
The leading housing finance company, HDFC, has raised the interest rate on the loans the bank offers to its customers. This change took effect right away. The FD interest rate in HDFC Bank is 5.35% for one-year deposits. The rate for senior citizens is 5.85%. HDFC Bank Savings account interest rate is at 3% for EOD balance below Rs 50 lakhs. It is 3.5% for EOD balance above Rs 50 Lakhs. HDFC Bank has hiked the interest rate on saving account deposits by 0.5%.
Indian Bank:
Indian Bank, like other banks, has raised the interest rates on the term deposits. This is in line with the RBI repo rate hike of 0.9%. The FD interest rate in Indian Bank is 5% for one-year deposits. The rate for senior citizens is 5.5%. The savings account interest rate is 2.9% at the Indian bank. Indian bank has hiked savings account rate by 0.15% after repo rate hikes.
Related: https://www.tomorrowmakers.com/other-investments/faqs-about-fixed-deposits-article
RBI has recently hiked the repo rate by 90 bps. They hiked the repo rate by 40 bps in an unscheduled policy meeting in May 2022. After that, they hike the repo rate by 50 bps in a scheduled policy meeting in June. An increase in repo rates increases the FD rates as well. The FD rates offered at various banks like the ICICI bank, HDFC Bank, PNB, Indian bank, etc. have increased. This is good news for savers.
An increase in repo rates results in an increase in the cost of funds for the banks. In response, they hike the loan rates. Also, they increase the deposit rates that they pay on FD as they can afford to pay more. Also, they need to attract savers.
Related: https://www.tomorrowmakers.com/other-investments/bank-fd-vs-fd-offered-nbfc-infographic2
Deposits
RBI repo hikes have allowed the interest rates on deposits to increase. This has generated the interest of people to save money in fixed deposits or savings accounts to earn some interest.
The world is battling with record inflation levels, and this is resulting in an increase in the interest rates by the Central banks worldwide. This is resulting in an increase in the policy rates worldwide. India is no exception to this.
Rates of interest are likely to go up for new retail borrowers. Borrowers who already have interest rates that are linked to the repo rate will be affected as well.
After the RBI raised the repo rate, several banks raised their interest rates on lending benchmarks, fixed deposits, and savings accounts.
ICICI Bank:
ICICI Bank changed its external benchmark lending rate in response to the change in the repo rate by the RBI. The deposit rates at ICICI bank are 5.35% to 5.85%, depending upon the deposit amount and whether the depositor is a senior citizen. ICICI Bank Savings account interest rate is at 3% for EOD balance below Rs 50 lakhs. It is 3.5% for EOD balance above Rs 50 Lakhs. This means that they have increased the savings account rates by 50 bps after the interest rate hikes.
Punjab National Bank:
PNB raised its repo-linked lending rate (RLLR) by 90 basis points. Existing customers will have to follow the new RLLR starting July 1, and new customers will have to do so immediately. The deposit rates at PNB are 5.2% for Indian citizens and 5.7% for senior citizens for the one-year term deposit. The savings rate in PNB is 2.7% for EOD balances below Rs 10 Lakhs and 2.75% for EOD balances above Rs 10 Lakhs. The bank has hiked the savings account rate by 0.05% in line with RBI repo rate hikes.
The Baroda Bank
The interest rates on loans went up immediately at the bank. The bank said on its website that the BRLLR for retail loans is 7.45 percent, the sum of the current repo rate of 4.90 percent, a markup of 2.55 percent. For the deposit rates, the Bank of Baroda's interest rate on term deposits for one year is 5%. For senior citizens, the interest rate is 5.5%. The savings account interest rate is 2.75% at the Bank of Baroda. The bank has hiked the savings account rate by 0.05% in line with RBI repo rate hikes.
HDFC Bank:
The leading housing finance company, HDFC, has raised the interest rate on the loans the bank offers to its customers. This change took effect right away. The FD interest rate in HDFC Bank is 5.35% for one-year deposits. The rate for senior citizens is 5.85%. HDFC Bank Savings account interest rate is at 3% for EOD balance below Rs 50 lakhs. It is 3.5% for EOD balance above Rs 50 Lakhs. HDFC Bank has hiked the interest rate on saving account deposits by 0.5%.
Indian Bank:
Indian Bank, like other banks, has raised the interest rates on the term deposits. This is in line with the RBI repo rate hike of 0.9%. The FD interest rate in Indian Bank is 5% for one-year deposits. The rate for senior citizens is 5.5%. The savings account interest rate is 2.9% at the Indian bank. Indian bank has hiked savings account rate by 0.15% after repo rate hikes.
Related: https://www.tomorrowmakers.com/other-investments/faqs-about-fixed-deposits-article
