Interest on daily product basis kicks in from April 1

Banks would have to move to the daily product method of calculating interest on savings account deposits from April 1, the Reserve Bank of India said in a notification to banks.

Currently, banks pay the mandated 3.5 per cent interest on the minimum balance in a savings account from the 10th to the last day of a month.

From April 1, banks will have to pay interest on the daily minimum balance in a customer's savings account, which will increase their interest outgo.