SBI FD Rates: Nowadays, everyone invests to secure their family’s future. If you are considering investing, this SBI Fixed Deposit (FD) scheme could be highly beneficial. SBI is making adjustments regarding high-value FDs; specifically, the bank has reduced interest rates on domestic bulk term deposits of ₹3 crore and above for certain tenures. These new rates will take effect on August 15, 2026.
This change will primarily impact customers who deposit ₹3 crore or more in SBI FDs. Notably, the bank has not reduced interest rates across all FD tenures; the cuts apply specifically to bulk FDs with shorter tenures.
Which FD interest rates has SBI reduced?
SBI has reduced interest rates for bulk FDs of ₹3 crore and above. SBI has cut interest rates for bulk FDs with tenures ranging from 7 days to 170 days by 25 basis points (bps). Additionally, rates for FDs with tenures between 180 days and 210 days have been reduced by 10 bps. However, there have been no rate cuts for bulk FDs with tenures ranging from 211 days up to 10 years. This implies the new rates will be most noticeable for customers depositing large sums for very short tenures, while interest rates for long-term bulk FDs remain unchanged.
What does a 25 bps cut mean?
In banking, interest rate changes are measured in basis points. 100 basis points equal 1 per cent. Here, 25 bps equals 0.25%, and 10 bps equals 0.10%. Therefore, when SBI cuts rates by 25 bps on bulk fixed deposits (FDs) with tenures ranging from 7 to 179 days, the interest rate for that period decreases by 0.25% compared to before.
Impact on Senior Citizens
This change by SBI also affects bulk FDs held by senior citizens. For the elderly, SBI has cut rates by 0.25% on FDs with tenures of 7 to 179 days. Additionally, SBI has reduced rates by 0.10% on FDs ranging from 180 to 210 days. This change has had no impact on FDs with tenures between 211 days and 10 years.
SBI offers higher interest rates on term deposits to senior citizens than to regular customers; according to bank documentation, resident senior citizens earn extra interest over the standard rate. Consequently, for elderly individuals depositing large sums, it is crucial to check the applicable tenure and the new interest rate before opening an FD.
What happens to existing FDs?
If you already hold an SBI bulk FD that has not yet matured, the interest rate on your existing FD generally does not change mid-tenure simply because a new rate has been announced. However, if your FD is nearing maturity and you intend to renew it, the interest rate applicable at that time will apply to the new FD. This means it would be incorrect to equate an old FD with a new or renewed one. Therefore, before renewing a high-value FD, verify the interest rate and tenure. Relief for those with FDs ranging from 211 days to 10 years
A key feature of this change is that SBI has not reduced interest rates for bulk FDs with tenures ranging from 211 days to 10 years. This means that if an investor plans to deposit a substantial amount for this duration, their FD rate remains unaffected by this specific change. However, this does not mean that these rates cannot change in the future; banks may revise their term deposit rates from time to time. Therefore, one should invest based on the rate applicable on the day the FD is opened.
What about FDs of less than ₹3 crore?
This change does not apply to standard retail FDs of less than ₹3 crore. If a customer invests ₹50 lakh, ₹1 crore, or ₹2 crore in a standard SBI retail FD, the bulk FD rate cut does not directly affect their investment. However, the bank can revise retail FD rates separately. Therefore, it is essential to check SBI’s current retail FD rates before investing.
What is the difference between Bulk FD and Retail FD?
Many people find it difficult to distinguish between bulk FDs and standard FDs. Simply put, a bulk term deposit involves depositing a large sum of money. In the context of SBI, this refers to domestic bulk term deposits of ₹3 crore and above.
Conversely, a standard customer opening an FD for an amount less than ₹3 crore falls under the retail term deposit category. For this reason, while SBI has lowered interest rates for certain bulk FD tenures, this change has not been applied to standard retail FDs.
Note for those investing large amounts in FDs? If you have a sum of ₹3 crore or more and are planning to invest it in a Fixed Deposit (FD), do not base your decision solely on interest rates. You must also gather information regarding the FD tenure, interest rate, premature withdrawal terms, tax and TDS implications, renewal rates, and so on.
1% Penalty on Premature Withdrawal
Investors may face a penalty if they need to withdraw funds prematurely from SBI’s bulk fixed deposits (FDs). A 1% penalty applies to premature withdrawals across bulk deposits of all tenures. If an individual has invested a large sum in an FD and suddenly needs the money, breaking the FD early could reduce interest or trigger a penalty, depending on applicable rules. Therefore, before locking a substantial amount into an FD, it is crucial to consider liquidity—that is, the need for funds—should the situation arise.
What Should Senior Citizens Consider?
Elderly individuals often prefer FDs due to their security. SBI offers higher interest rates to senior citizens compared to regular customers. However, senior citizens investing large sums in bulk FDs should specifically verify the prevailing interest rate for their chosen tenure. This is because a reduction in interest rates on short-term bulk FDs can lead to a difference in returns between older and newer investments.
Conclusion
SBI, the country’s largest public sector bank, has reduced interest rates on domestic term deposits (bulk FDs) of ₹3 crore and above for specific tenures, effective August 15, 2026. Interest rates have been cut by 25 basis points (0.25%) for bulk FDs with tenures ranging from 7 to 179 days, and by 10 basis points (0.10%) for those ranging from 180 to 210 days. However, interest rates for bulk FDs with tenures ranging from 211 days to 10 years have not been reduced. These rate cuts also apply to bulk FDs held by senior citizens. Notably, this change has not affected standard retail FDs (amounts below ₹3 crore).