India’s largest bank State Bank of India has moved to a new interest rate regime on large savings account deposits as well as short-term loans.In March, SBI had announced that it will link its interest rate on savings account with balance above 1 lakh and short-term loans like overdraft and cash credit facility to Reserve Bank of India’s repo rate, effective 1 May 2019.
The interest rates on large SBI savings account deposits and interest rate on some short-term loans will automatically change as and when RBI changes its repo rate. This will help in better transmission of RBI’s policy rates into the banking system.
