HDFC Bank reduced its interest rate for saving accounts to 2.75% for every balance under Rs 50 lakh while implementing a 25 basis point decrease. The new rate which started on April 12 stands as the minimum interest rate among all private sector banks operating in India. The interest rate for savings accounts exceeding Rs 50 lakh now stands at 3.25% after the previous rate of 3.5%.
The Reserve Bank of India’s 25 basis points repo rate reduction prompted this change in banking sector interest rates. The interest rate of 3% maintained by ICICI Bank and Axis Bank for balances under Rs 50 lakh remains higher than HDFC Bank’s current lowest rate.
The financial institution performs daily interest calculations which result in quarterly deposits to savings accounts. A savings account with Rs 50,000 and a 3% interest rate generates daily earnings of Rs 4 and quarterly payments of Rs 123.28. The new interest rate implemented by HDFC Bank results in reduced daily earnings for account holders.
HDFC Bank reduced its fixed deposit interest rates by 35-40 basis points across specific time periods during the previous month. The interest rate adjustments at Canara Bank and Bank of Baroda occurred as the market interest rates shifted.
The market conditions indicate decreasing interest rates for savings which drives customers toward better-paying investment choices.
