As banks’ chase for customers to collect cheap deposits is not fructifying, they are forced to offer inflation-beating real interest rates on fixed deposits now, and StateLed by Punjab & Sind Bank Tops the list with a deposit rate of 8-8.5% per annum
Banks We are required to offer an inflation-beating deposit rate for a term ranging from 200 up to 800 days because credit growth has been much faster than deposit mobilization during this fiscal, resulting in a funding crunch.
Also read: Huge Rates of interest in savings banks after the office have increased
Even Fixed deposit pricing at a low 7% is good for customers, even after a sudden rise in retail inflation. January The real rates are in green at 6.52%
Inflation For 10 months, 2022, it was over 6% Reserve Bank Rates to rise by 250 bps to 65.00% in six consecutive hikes May 2022.
For The fortnight to January 13, 2023 credit growth was 16.5% per annum, compared with 10.6% for deposits. In In reality, the deposit growth for nearly the whole year has been in the low-single digits. The recent spike is due in part to an increase of deposit rates. December.
The Rates can be improved from all angles. One-year postoffice deposits fetch 6.6% and 6.8% respectively, while 10-year government securities yield only 7.35%.
The Banks have almost completely passed the 250-bps RBI rate increase since and are offering high rates. May last year to their borrowers, they’ve not been doing so for deposits, leading to a funding gap and forcing them to borrow from the market.
According According to the new deposit pricing, any depositor at a public sector bank will be guaranteed 7 to 7.25% on fixed deposits with a tenor from 200 to 800 days.
The nation’s largest lender State Bank Of IndiaThe largest retail franchise, with approximately 20,000 branches, offers 7.10% to the general public, and 7.60% for senior citizens. This is an annualized basis for fixed deposits within the 400-day bucket.
Punjab & Sind Bank Retail depositors can get the best deal at 8%, while senior citizens receive 8.50% for the 221-day bucket.
The Central Bank Of India Senior citizens get 7.85% for 444 days, and retail customers get 7.35%. This is the second-best rate. Union Bank Of India It is pricing 800 day deposits at 7.30% for senior citizens and retail, and 7.80% to seniors.
Punjab National Bank It offers senior citizens and retail customers 7.25% and 7.75% respectively on its 666 day bucket. Bank Of Baroda’s new pricing comes at 7.05% and 7.755% for 399 days; Bank Of India The rate is the same as the one of Bank Of Baroda For 444 days, while Bank Of Maharashtra’s new rate is 7% and 7.50% for 200 days.
For 400 days, Canara Bank Offers 7.15% and 7.65% Indian Bank UCO pays 7% and 7.5% for its 555-day deposits; Bank Available at 7.15% or 7.25% for 666 Days; Indian Overseas Bank For 444 days, is offering 7% or 7.50%
On HDFC is the largest private sector lender. Bank For five years, the bank offers a mere 7% rate to the general population and 7.50% for senior citizens depositors. Its immediate competitor is ICICI Bank For purchases lasting more than 15 calendar months, 7% is available to retailers and 7.5% for senior citizens.