SBI: New rules to come into effect from May 1

The largest Public Sector Bank in India, State Bank of India( SBI) has changed some rules that will come into effect from May 1.

From May 1, SBI will link its loans and deposit rates to the repo rate. This will make loans from SBI cheaper. The SBI has become the first bank to implement it.

According to the new rules, after May 1, the SBI’s Savings account holders will get less interest on deposits of more than one lakh rupees. In a notification, the SBI has said that from 1st May 2019, the SBI account will get less interest of 0.25-0.75% on the amount more than Rs 1 lakh. The interest rate for deposits up to Rs 1 lakh will be 3.50% while for deposits above Rs 1 lakh, the interest rate will be 3.25%.

Following the repo rate cut by the Reserve Bank of India, several banks including SBI slashed their interest rates. SBI has cut interest rates by 0.10% on a home loan up to Rs 30 lakh. The current interest rates on home loans of less than Rs 30 lakh is between 8.60 to 8.90%. Earlier this rate was 8.70 to 8.90%.