Savings Account Interest rates: List of Banks that have cut savings account rates

Several banks have lowered their interest rates after the Reserve Bank of India (RBI) cut its key policy rates in its latest monetary policy meeting. In its last meeting on May 22, the Monetary Policy Committee had slashed repo rate by 40 basis points. Following the rate cut, the repo rate now stands at 4 per cent and reverse repo rate at 3.35 per cent.

The RBI has reduced interest rate several times to infuse liquidity in the market amid economic stress due to coronavirus pandemic. In April, the RBI had unexpectedly cut repo rate to discourage banks from parking idle funds with it while propelling lending and remedy the economic slowdown. The repo rate had already reached its lowest level in March at 4.4 per cent when the RBI had reduced it by 75 basis points.

Now banks have started lowering their savings interest rate to encourage customers to spend more. The excess liquidity infused by the RBI and scanty demand for fresh loans has also led to reduction in interest rates.

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Here's a look at how much some major banks have lowered their savings accounts rates:

State Bank of India: On June 2, the State Bank of India had lowered its interest on savings bank deposits by 5 basis points to 2.70 per cent per annum across all tenors. The revised rates will be applicable from May 31, 2020.

ICICI Bank: Private lender ICICI Bank has cut interest rates on savings deposits by 25 basis points, which will come into effect from June 4. Deposits of less than Rs 50 lakh will incur interest of 3 per cent, whereas for deposits worth Rs 50 lakh or more, interest rate will be 3.50 per cent.

Axis Bank: Axis Bank had lowered its interest rates on savings accounts by 25 basis points on June 1. For savings deposit up to Rs 50 lakh, interest has been lowered to 3.5 per cent, whereas for balance above Rs 50 lakh, the interest rate stands at 3.5 per cent.

Kotak Mahindra Bank: For balance up to Rs 1 lakh, Kotak Mahindra Bank is offering interest rate of 3.50 per cent, and for balance above Rs 1 lakh, it is offering 4 per cent interest.

ALSO READ: Banks sit tight on cash rather than lend money despite RBI's liquidity efforts