SBI cuts interest rate on savings bank deposits. Will other banks follow?

Savings bank deposits with SBI since June 2011, as with most other banks, earned an interest of 4%

State Bank of India (SBI) has introduced a two-tier interest rate structure on savings bank deposits. With effect from July 2017, a savings bank balance of over Rs 1 crore will earn an interest rate of 4% per annum (p.a.), while the ones with Rs 1 crore or less will earn an interest rate of Rs 3.5% p.a. The move sent the stock soaring 4% in intra-day deals to Rs 313 levels on the Bombay Stock Exchange (BSE).

“The decline in the rate of inflation and high real interest rates are primary considerations warranting a revision in the rate of