Sbi To Revamp Deposit Plans For Flexibility

The State Bank of India (SBI) has initiated restructuring of its personal segment to introduce certain modifications in its deposit schemes. The aim is to bring in innovative products to provide more flexibility to the depositors.

The country's largest commercial bank is gathering data on the performance of its existing schemes and evaluating several options.

The products will be combination of three basic concepts - savings bank deposits, term deposits and recurring deposits. The facilities involved in all these deposits will be incorporated in the new schemes offering more flexibility and better return to the depositors. "In this age of competition, innovation is the key to success", said sources in the banking sector.

 

Competition is hotting up all the more in the personal segment, which is one of the focus areas of SBI. "All the banks are offering more or less the same interest to its depositors. The interest ranges from 7 per cent to 10.5 per cent. Hence the most important aspect is designing of the product," sources said. The highest interest is available for fixed deposits over three years.

Nationalised banks follow SBI's strategies in this regard. "We will closely watch new innovations brought about by SBI and follow suit", said a highly-placed banking official.

However, the reduction of savings rate by 50 basis points to 4 per cent is not a matter of concern to the bankers. "Depositors with savings accounts will still be there because of the need for liquidity", sources said.

This apart, technology is the top priority of SBI. Networking of branches, internet and 24-hour banking are in the offing. In fact, the general impression is that banks which ignore technology will be wiped out.