SBI increases interest rates for fixed deposits

New Delhi: India's largest lender State Bank of India revised its fixed deposit interest rates on Wednesday (November 28). The bank hiked interest rate on select maturities by 5 to 10 basis points. It may be noted that one basis point is equal to 0.01 per cent. The interest rate is increased on fixed deposits below Rs 1 crore. 

The interest rate payable to Senior Citizens has been increased as well. Other lenders like Kotak Mahindra Bank, HDFC Bank, ICICI Bank etc also hiked their fixed deposit interest rates recently.

The interest rate payable to the SBI Staff and SBI pensioners will be 1.00% above the applicable rate. The rate applicable to all senior citizens and SBI pensioners of age 60 years and above will be 0.50% above the rate payable for all tenors to resident Indian senior



citizens i.e. SBI resident Indian senior citizen pensioners will get both the benefits of Staff (1%) and resident Indian senior citizens (0.50%).

SBI had last increased interest rate on July 30 on fixed deposits having more than one-year maturity. Recently, many other lenders (both private and state-owned) have increased their deposit rates in order to attract deposit from investors in the wake of the liquidity crisis faced by the banking industry. 

Analysts say rupee's depreciation against the US dollar and higher crude oil price has resulted in interest rate tightening in the economy. The 10-year government bond yield, which is an indicator of the prevailing interest rate in the economy, rose to a one-year high of 8.18 per cent in the month of September before falling to 7.68 per cent recently.