Among these banks, savings accounts are earning higher interest rates than many large banks.
At a recent credit policy meeting, the RBI decided not to change the policy interest rate. Savings account and FD holders have got some relief in such a situation. Some banks are still offering better rates than major public and private sector banks.
- Last updated:
December 14, 2020, 12:23 pm IST
Good interest rates in small private banks
The data collected from the bank’s market shows that some of the newer banks, such as Bandhan Bank and IDFC Bank, are earning interest rates on savings accounts at 7.15 per cent and per cent, respectively. These interest rates are somewhat better than those of small finance banks. For example, AU Small Finance Bank and Ujjivan Small Finance Bank are earning 7% and 6.5% interest on savings accounts, respectively.
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In comparison, large public and private sector banks have lower interest rates on savings accounts. Private sector HDFC Bank (HDFC Bank) and ICICI Bank (ICICI Bank) are offering interest rates at 3 and 3.5 per cent, respectively. The interest rate is 2.70 per cent in the public sector State Bank of India (SBI) and 2.75 per cent in Bank of Baroda (BOB).
Obligation to maintain a minimum balance
The minimum balance in a private bank savings account ranges from 500 to 10,000. This is more often the case than public sector banks. The minimum mandatory balance between IDFC Bank and the bond is Rs 10,000 and Rs 5,000 respectively. In fact, the target of private banks is consumer salaried middle class and self-employed people. The major private banks of Axis Bank and HDFC Bank have up to Rs 2,500 and Rs 10,000 respectively.
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Generally people advise experts to choose the same bank, which has more track record, has better service, its branch network and ATM service should also be better. If a bank gets a good interest rate, it will be considered better.