SBI, Bank of Baroda raise term deposit rates

Public sector lenders State Bank of India (SBI) and Bank of Baroda (BoB) have announced a hike in interest rates on fixed deposits varying from 50 to 125 basis points

SBI on Wednesday raised interest rates on fixed deposits by up to 50 basis points (bps) across various tenors, while BoB on Thursday announced an upward revision in the interest rates on domestic retail term deposits, including NRO term deposits, between 10 and 125 basis points, based on maturity basket,  effective 29 December 2023.

For retail term deposits maturing between seven days to 14 days, Bank of Baroda has raised the interest rates to 4.5% per cent from 3 per cent. The bank is offering an interest rate of 4.75 per cent, up from 3.50 earlier, to senior citizens on the same tenor.

SBI has raised interest rates on retail term deposits maturing between seven and 45 days by 50 basis points to 3.5 per cent while also raising interest rate pain to senior citizens to 4 per cent from 3.5 per cent.

For deposits of 46 days to 179 days, the interest rate has been increased by 25 bps to 4.75 per cent. Senior citizens are entitled to 5.25 per cent on this tenor.

Deposits maturing between 180 days to 210 days, the new rate offered is 5.75 per cent as against 5.25 per cent earlier. Senior citizens will get 6.25 per cent on this tenor against 5.75 per cent earlier.

For deposits between 211 days to less than one year the new rate is 6 per cent up from the existing 5.75 per cent. Senior citizens are entitled to interest rate of 6.5 per cent.

SBI has revised interest rate on deposits maturing between three years and less than five years by 25 bps to 6.75 per cent.

Interest rates on fixed deposits maturing between one year to less than two years, two years to less than three years and five years and up to 10 years have been left unchanged at 6.8 per cent, 7 per cent and 6.5 per cent, respectively.

SBI, however, raised interest rates on domestic bulk deposits (Rs2 crore and above) by up to 50 bps, effective 27 December 2023.

SBI had, earlier this month, raised its marginal cost of fund-based lending rate (MCLR) by 5-10 basis points (bps) across different tenors. 

Other lenders are expected to follow the public sector banks’ move to raise interest rates on retail term deposits.