turning to assets like depositors Sleep Can affect financial savings and further affect investment.
In an interview with The Times of India newspaper, the RBI governor said, “When the central bank communicates what it is focused on inflation And takes steps in that direction, it gives homes and businesses confidence and a clear message.”
Further, Das said it will ease inflation expectations and moderate the impact of the second round of supply shocks. Ultimately, there may be a moderation in core and core inflation.
However, Das also said, “We must not forget the depositors whose savings are used by banks to function.”
According to the RBI governor, in an environment of high inflation, if interest rates are kept artificially low, the real rate of return for depositors will become more negative and if this happens, depositors will turn to other assets like gold. can turn.
“This will impact financial savings and there will be an immediate impact on investment,” Das said.
Any change in RBI’s policy repo rate will have an impact on the lending and deposit rates of the bank. However, the quantum and timing of policy repo changes depend on the bank.
In a rate hike scenario, interest rates on term loans such as house, car, and personal among others seem to be rising. However, it is the opposite for deposits as they look attractive – traditional schemes offer depositors a huge return on their investment, especially in fixed deposits which are less risky than market instruments and also provide guaranteed returns. We do.
In the last two monetary policies, the RBI has increased the repo rate by 90 basis points. In May, the RBI increased the rate by 40 basis points and raised it to 50 basis points in the June 2022 policy. Now, the policy repo rate is 4.9%.
RBI has projected an inflation rate of 6.7% for the financial year FY23. Supporting growth, RBI’s medium-term target for inflation is 4% with a band of +/- 2%.
Inflation has remained above the RBI’s comfort zone for the fifth consecutive month. In May, the consumer price index stood at 7.04%, however, it declined from the 95-month high of 7.79% seen in April this year.
Bank deposit and lending rates have also increased.
These three banks offer inflation-beating interest rates to senior citizens.
RBL Bank:
down on FD 2 crore, RBL Bank offers 7.15 percent interest rate to senior citizens on a tenure of 15 months. RBL Bank also offers 7% interest rate to senior citizens for tenures ranging from 24 months to less than 36 months.
For senior citizens, the bank offers an interest rate of 6.80% on tenures ranging from 36 months to less than 60 months; 60 months to 60 months 1 day; and Tax Saving Fixed Deposit (60 months).
Meanwhile, the bank offers a rate of 6.75% on maturities ranging from 12 months to less than 15 months; and 15 months from 1 day to less than 24 months. Also, the rate is 6.25% on tenures of 60 months 2 days to 240 months.
The rate is 3.75% to 5.75% on tenure of 7 days to 364 days.
AU Small Finance Bank:
From June 24, AU Small Finance Bank offers a rate of 7.10% to senior citizens on tenures of 12 months 1 day to 15 months.
It also offers an interest rate of 7.40% on each tenure – 24 months from 1 day to 36 months; 36 months from 1 day to 45 months; and from 60 months to 120 months.
Meanwhile, the bank offers a rate of 6.95% on tenures like 15 months 1 day to 18 months; 18 months 1 day to 24 months; and 45 months from 1 day to less than 60 months.
Whereas the interest rate ranges from 4.25% to 5.85% on a period ranging from 7 days to 12 months.
Interest rates applicable on the following FDs 2 crores.
IndusInd Bank:
However, IndusInd Bank does not offer above inflation rate of 7.04%. However, it allows senior citizens a maximum rate of 7% on deposits less than 7% which is close to the inflation rate. 2 crores on tenure of less than 2 years to 61 months.
The private bank also offers 7% rate on Indus Tax Saver Scheme to senior citizens for 5 years.
In addition, the bank offers 6.75% on tenures ranging from 1 year 6 months to less than 2 years; Whereas for less than 1 year the rate for 1 year 6 months is 6.50%; and 61 months and above.
For senior citizens, the bank offers an interest rate of 3.75% to 6% on tenures ranging from 7 days to 364 days.
IndusInd’s interest rate is still higher as compared to peers like HDFC Bank, ICICI Bank, Axis Bank and Kotak Bank.