In less than two weeks of RBI raising its repo rates the third time, HDFC Bank has raised its interest rates on fixed deposit (FD). The latest rates offered by the largest private lender came into effect from August 18 onwards. The rates have been revised for deposit amounts less than ₹2 crore as well as greater than ₹2 crore to less than ₹5 crore.
Now, the fixed deposits of tenor between 1 to 3 years will offer an interest of 5.5 percent. The long duration FDs between 3 to 5 years will offer an interest of 6.10 percent. Ironically, the interest on a longer duration term deposits i.e., between 5-10 years will be 5.75 percent.
At the same time, the short duration FDs will offer an interest rate in the range of 2.75 percent to 4.65 percent.
For instance, an FD of tenor between 7 days to 29 days will offer an interest of 2.75 percent. From 30 days to 89 days, FD will offer an interest of 3.25 percent. The rate of interest will increase to 3.75 percent for deposits of tenor between 90 days to six months. And the interest will further rise to 4.65 percent for deposits of tenor between six months to one year.
The senior citizens are entitled to receive a rate which is higher by 50 basis points across tenors.
Following the RBI's policy meet, the private lender also already raised its marginal cost of funds based lending rates (MCLR) with effect from August 8, 2022.
It is vital to note here that several private and public sector banks have raised their fixed deposit rates in the past two weeks ever since the banking regulator raised its repurchasing option rates. These include Canara Bank, Indian Bank, Bank of Baroda and ICICI Bank.
Prior to this, commercial banks raised their FD rates a slew of times following the RBI’s two previous monetary policy committees wherein the repo rates were raised by a total of 90 basis points – on May 4 and June 8 by 40 bps and 50 bps respectively.
Prior to that, Punjab National Bank raised its FD rates, HDFC Bank raised the FD rates twice in a week in June, South Indian Bank raised the interest rates in April followed by Bajaj Finance Bank, among others.