SBI account holder? Five changes are set to affect you from tomorrow

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Good news for all account holders of State Bank of India (SBI) as country’s largest lender will be introducing some changes for its customers from May 1. In a first, the state-owned bank will be linking its loan and deposit rates to Reserve Bank of India (RBI’s) repo rate. The new rule is expected to make the loans cheaper. Besides, customers of SBI savings account will get less interest on deposits of more than one lakh rupees. 

  1. Lower interest rates for deposits above Rs 1 lakh:

All savings account holders of SBI will get less interest on deposits on above Rs 1 lakh. For balances up to Rs 1 lakh, SBI will offer an interest rate of 3.50 per cent per annum while for deposits above Rs 1 lakh, the interest rate will be 3.25 per cent.

2. Repo rate- interest rate linkage

SBI will link its key pricing decision for savings bank deposits and short term loans to the repo rate of RBI, with effect from May 1, 2019. SBI is only bank to implement the linkage of repo rate to loan interest. The move is likely to make EMIs cheaper. Following the repo rate cut by RBI, SBI has reduced its interest rate by 10 basis points or 0.10 per cent on home loans of up to Rs. 30 lakh.

The interest rate on SBI housing loans or home loans below Rs 30 lakh now stands in the range of 8.60-8.90%. SBI also reduced its benchmark MCLR by 5 basis points (0.05 per cent) across all tenors. The MCLR now stands at 8.50 per cent for the one-year tenor.

3. SBI will link its pricing decision for saving bank deposits and short term loans to the repo rate of the Reserve Bank of India (RBI), with effect from May 1, 2019.

4. According to the lending major, the step is in order to address the concern of rigidities in the balance sheet structure and for quick transmission of changes in RBI’s policy rates.

5. For balances up to Rs. 1 lakh, SBI will offer an interest rate of 3.50 per cent per annum, the lender said.

6. State Bank of India, the largest bank in the country, has announced that it is slashing the interest rates offered on car loans for electric vehicles (EV).

The bank said that it will offer a discount of 20 basis points on the interest paid on the loan. Additionally, borrowers will also get a longer repayment period. These deals are offered in an attempt to encourage adoption of electric vehicles in India.

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