SBI on Wednesday cut interest on savings bank accounts to 3 per cent and also waived minimum balance requirement, as it set the trend of lowering interest rates in the banking sector.
More banks are likely tofollow the market leader in slashing interest rate on SB accounts and waiving minimumbalance requirements.
Earlier in the day, State Bank of India (SBI) reduced itsfixed deposit rates and marginal cost of funds-based lending rates (MCLR) forvarious tenors.
“The decision by @TheOfficialSBI to remove minimum balancerequirement in its savings accounts will immensely help middle class and poorand improve ease of living,” Finance Minister Nirmala Sitharaman said in atweet.
Keeping in mind the ‘Customers First’ approach, the bank saidit has also waived SMS charges, which will bring significant relief to all thecustomers.
“Bank has also rationalised interest rate on SB Account to aflat 3 % p.A. For all buckets,” it said in a statement.
Currently, the interest rate on SB accounts is 3.25 per centfor deposits up to Rs 1 lakh in SB accounts, and 3 per cent for deposits aboveRs 1 lakh.
SBI said it has decided to waive maintenance of AverageMonthly Balance (AMB) for all SB accounts.
“The charges on maintaining AMB are now waived off on all44.51 crore SBI savings bank accounts,” it said.
Currently, SBI customersneed to maintain AMB of Rs 3,000, Rs 2,000 and Rs 1,000 in metro, semi urbanand rural areas, respectively.
The bank used to levy a penalty of Rs 5 to Rs 15 plus taxes on non-maintenance of AMB.