The State Bank of India (SBI), India’s biggest lender, has reduced its lending rate by 50 basis points in response the RBI’s policy rate cut, thus making loans cheaper for borrowers. With this, the repo linked lending rate of SBI would come down by 50 basis points to 7.75 per cent. The SBI has also reduced the external benchmark-based lending rate to 8.15 per cent from 8.65 per cent. The revised rates come into effect from Sunday.
The RBI had announced a jumbo rate cut on June 6 by 50 basis points to support growth, which dropped to 6.5 per cent in FY25, the lowest in four years.
The RBI also cut the cash reserve ratio by 100 basis points to 3 per cent, adding Rs 2.5 lakh crore to the already surplus liquidity in the banking system by December this year. Subsequently, most banks have slashed lending rate and the rest are expected to soon follow suit.
SBI has also cut deposit rates by 25 basis points across all maturities for fixed deposits up to Rs 3 crore. The new term deposit rates are effective from June 15. With this, the interest rate on 1-2-year term deposits will be lower by 25 basis points to 6.50 per cent and deposits having two years to less than 3 years of maturity will attract an interest rate of 6.45 per cent instead of 6.70 per cent. In case of fixed deposits with maturity of 3-5 years, interest rate has been reduced by 25 basis points to 6.30 per cent, while it has been brought down by 25 basis points to 6.05 per cent for 5-10 years.
The interest rate of a specific tenor scheme of “444 days” (Amrit Vrishti) has also been revised from 6.85 per cent to 6.60 per cent. It will be effective from June 15. Senior citizens have been offered an additional 50 bps, while super senior citizens can avail an additional 60 basis points over the card rate.
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