HDFC, ICICI Bank cut retail deposit rates after RBI repo rate reduction

HDFC Bank and ICICI Bank lower fixed deposit and savings account interest rates following the RBI's 50 basis point repo rate cut amid slow policy transmission

Two of the country’s largest private-sector lenders, HDFC Bank and ICICI Bank, have reduced interest rates on fixed deposits below ₹3 crore by 25 basis points (bps) in select tenures, reflecting the 50 bps rate cut in June by the Reserve Bank of India’s (RBI) monetary policy committee (MPC). 

 

Cumulatively, the MPC has cut repo rate by 100 bps since February. The repo rate now stands at 5.50 per cent.

 

HDFC Bank has also reduced interest rate on savings account deposits of above ₹50 lakh by 50 bps. Now, the bank offers a flat rate of 2.75 per cent on all savings balances. Previously, the bank was offering 2.75 per cent for savings on balances up to ₹50 lakh, and 3.25 per cent on balances beyond ₹50 lakh.

   

Following the revision in interest rates on fixed deposits, HDFC Bank now offers fixed deposit (below ₹3 crore) interest rates ranging from 2.75 per cent to 6.60 per cent per annum, and 3.25 per cent to 7.10 per cent for senior citizens. 

 

Meanwhile, ICICI Bank, following the rate cut, offers fixed deposit (below ₹3 crore) interest rates ranging from 3 per cent to 6.6 per cent, and for senior citizens it ranges from 3.5 per cent to 7.1 per cent.

 

Meanwhile, the RBI has also kept the system liquidity in surplus to transmit the repo rate cut into lending and deposit rates. The transmission into rates has also been slow to happen.

 

According to RBI data, the weighted average lending rate on fresh rupee loans and outstanding rupee loans declined by 6 bps and 17 bps, respectively, during February-April 2025 due to policy rate transmission to lending rates.

 

And, the weighted average domestic term deposit rates (WADTDR) on fresh deposits fell by 27 bps, while WADTDR on outstanding deposits declined by 1 bp during February-April 2025.