The country’s largest public sector bank, State Bank of India (SBI), has dealt a blow to FD investors. SBI has reduced the interest rate on its special FD scheme, “Amrit Varsha.” The new interest rates are effective from June 15, 2025. This means that investors will now receive a lower interest rate on deposits under this scheme. However, SBI has not made any changes to other regular FD interest rates.

How much has the “Amrit Varsha” rate been reduced

The interest rate under SBI’s special “Amrit Varsha” scheme has been reduced by 25 basis points (bps). The interest rate for ordinary citizens for a 444-day term under this scheme is now 6.6% per annum, down from 6.85% per annum previously. Senior citizens and super senior citizens continue to benefit from the additional interest rate.

What will senior citizens receive

Senior citizens and super senior citizens (80 years and above) continue to benefit from the additional interest rate. Senior citizens are now offered an interest rate of 7.10% per annum on this special SBI FD scheme. Super senior citizens (80 years and above) receive an additional benefit of 10 bps above the applicable interest rate. After the revision, super senior citizens are now offered an interest rate of 7.20% per annum.

What are the rules for premature withdrawal

The premature withdrawal policy has also been changed. For retail FDs up to ₹5 lakh, a penalty of 0.50% will apply for premature withdrawal (across all tenors). For retail FDs above ₹5 lakh but less than ₹3 crore, the premature withdrawal penalty will be 1% (across all tenors).

This decision comes after the Reserve Bank of India (RBI) cut the repo rate by 50 basis points in its June monetary policy meeting last week, following which most banks, including ICICI Bank, HDFC Bank, and Canara Bank, also cut their fixed deposit interest rates.

Special Advice for Investors

Even though SBI has cut the ‘Amrit Varsha’ rates, the scheme remains an attractive option for senior citizens, offering rates up to 7.20%. If you want a safe investment for the long term, FDs remain a good option. However, you should now compare the current rates across banks before making an investment decision.