Major banks cut lending, deposit rates following RBI’s repo rate cut

The country’s largest lender State Bank of India (SBI) and Bank of India have reduced the lending rates after the policy rate of Reserve Bank of India (RBI). , Photo Credit: Reuters

Major banks have cut their debt and deposit rate after 50 basis points of the Repo Bank (RBI) of the cuto at the repo rate in 2025.

The largest private sector bank HDFC Bank cut its deposit interest rates by 25 basis points. A base point is one hundredth of percentage.

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HDFC Bank announced that savings deposits for accounts with less than ₹ 50 lakh will be effective from 2.75% and more than 3.25% above ₹ 50 lakh from April 12, 2025. Interest rates are changing for the first time in about three years, when the related rates were 3% and 3.5%.

SBI cut its fixed deposit interest rates for senior citizens. Interest rates for FDS (fixed deposits) that mature between one and three years will now be collectively 20 basis points. According to SBI’s website, 15 April 2025, the FDS between one and two years will now earn an interest rate between 7.2% to 7.2% to 7.2% between one and two years and 7.5% to 7.4% between two and three years of tenure.

Bank of India reduced its FD interest rates for an amount of less than ₹ 3 crore and is now offering 4.25% to mature between 91 days and 179 days. The rate of 5.75% is given for deposit less than one year for 180 days. The deposit amount for one year will get an interest rate of 7.05%, while people up to 2 years above 1 year will get 6.75%. For depositing in less than ₹ 3 crore in a bucket of less than ₹ 10 crore, the bank will offer 5.75% for the money that matures between 91 days and 179 days, the interest rate of 6.25% is being offered up to 210 days and 6.50% for 180 days, less than a year for less than a year.

Banks also reduced their lending rates. State Bank of India, Bank of Maharashtra also cut their lending rates among others. SBI cut the repo rate cut rates from 25 basis points to 8.25% and external benchmark lending rates 8.65%. Bank of Maharashtra also announced a cut of 8.65%in external benchmark rates.

The deposit and lending interest rates have been cut after the RBI announced a 25-base point cut at the repo rate, at which the commercial bank borrow from the central bank. The repo rate at the beginning of the calendar year was 6.5%. After two consecutive cuts, the rates are now at 6%, and the RBI quoted that retail inflation is well within the target area of ​​4% and the march inflation is expected to be in line with the target rate.

Changes in interest rates occur at a time when the Finance Ministry and RBI had flagged off that families were going into market-based investment and savings equipment such as mutual funds and did not like banks.