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SBI Cuts Savings Rate to 2.5%, Reduces FD Yields and Lending Rates After RBI Repo Rate Cut

The adjustment aligns SBI with the RBI’s growth-supportive policy by trimming its annual interest payout by roughly Rs 5,750 crore

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Overview

  • The Reserve Bank of India lowered its benchmark repo rate by 50 basis points to 5.5% on June 6 to bolster growth after FY25 GDP slowed to 6.5%.
  • State Bank of India set a uniform savings account rate of 2.5% on all balances effective June 15, down from a tiered structure that reached 3%.
  • SBI cut fixed deposit rates by 25 basis points for deposits up to Rs 3 crore, with one-year tenors now offering 6.05% for general customers and 6.55% for senior citizens.
  • The lender trimmed its external benchmark-based repo-linked lending rate by 50 basis points, bringing its RLLR to 7.75% and home loan rates to a range of 7.5%–8.45%.
  • Major banks including HDFC Bank, ICICI Bank, Canara Bank and Indian Overseas Bank have followed suit by lowering deposit and lending rates in response to the RBI’s rate cut.