Private lender, Kotak Mahindra Bank has hiked savings account interest rate up to 4 percent as well as fixed deposit interest rates across various tenors. The increase in savings account interest rate will come into effect on 13th June, 2022.
The bank said, daily balances in savings account above Rs. 50 lakh will now earn a 50 basis points higher interest rate of 4% p.a. from the earlier rate of 3.5% p.a. Interest rates on fixed deposits have been increased by 10 to 25 basis points.
Shanti Ekambaram, Group President – Consumer Banking, Kotak Mahindra Bank said, “Interest rates are now on an upward trajectory. For Kotak, customer centricity has been the core of all our initiatives and as their trusted banking partner, we strive to empower our customers with products and services catering to their needs. In line with this philosophy, we have revised our savings account interest rate upwards to 4% p.a.* as well as hiked our term deposit rates for various tenors enabling our customers to enjoy higher interest rates.”
Other banks are likely to increase their savings account interest rate post the Reserve Bank of India’s (RBI) rate reversal by 90 basis points over last two monetary policies.
RBI’s monetary policy committee on June 8 hiked the repo rate, the key policy rate at which central banks by 50 basis points, with the repo rate standing at 4.9 percent. On the policy rate, Ekambaram added, “In line with market expectations the MPC decided to increase repo rate by 50bps and also sharply increased inflation expectation to 6.7%. Further they continued to emphasize on withdrawal of accommodation on the liquidity side and retained the growth target @7.2% . Given the geo political tension, high commodity prices including oil we expect MPC to continue to hike rates in the subsequent policies in this fiscal to manage inflationary expectations.”