Good News Before Christmas! HDFC Increases Interest Rates on Fixed Deposits by This Much

India’s largest private bank HDFC Bank has launched a new initiative for its lakhs of customers. The bank will now simplify the process of depositing money for senior citizens under the government-run Senior Citizen Savings Scheme. In the announcement, HDFC Bank said that as an agency bank of the government, it will provide an easy and smooth procedure to access this facility, while deposits are made for senior citizens as per the scheme. The bank also said that customers can apply for the Senior Citizen Savings Scheme at any branch of HDFC Bank.

8.2% Return on Investment

HDFC Bank is already accepting applications for small savings schemes which include: Public Provident Fund (PPF) and Sukanya Samriddhi Yojana. The Senior Citizen Savings Scheme is currently offering a good annual return of 8.2%.

HDFC Bank Increases Interest on Deposits Above Rs 5 Cr

HDFC Bank has raised interest rates for fixed deposits across categories. The interest rates are increased by a range of 5 to 10 basis points, and the interest rates apply to all tenors. The interest rates are raised to match the offerings of competitors.

Whenever the Reserve Bank sounds like it might lower the repo rate, banks also increase the rates it pays on deposits, regardless of the tenor. According to the Reserve Bank, the growth rate of bank deposits and loans until December 2024 remains at 11.5%. HDFC Bank is currently paying the following interest rates on fixed deposits: 7.4% for 1 year to 15 months, and 6.6% to 7.0% for 1-5 years.

Will interest rates on loans also increase?

After the increase in interest rates on fixed deposits of these two banks, many are wondering whether the interest rates on loans may also increase this time. However, it completely depends on the repo rate of the Reserve Bank. The money deposited in the bank is given as a loan and higher interest is charged on the loan, which makes the bank profitable.

Punjab National Bank also gave a great gift to its customers in this new year. This bank has increased the interest rates on fixed deposits. The bank has changed the interest rates for some selected tenors.