State Bank of India (SBI), the country’s largest bank has launched a special fixed deposit (FD) scheme for senior citizens known as ‘SBI Wecare Deposit’. This FD scheme has been introduced amid covid-19 in the retail term deposit segment for safeguarding the senior citizens interests in the current falling rate scenario.
What is SBI Special FD Scheme?
According to SBI, this new scheme will target senior citizens, & provide them an additional 30 basis points (bps) premium which will be payable for their retail term deposits with “5 Years & above" time period only. Interestingly, the ‘SBI Wecare Deposit’ scheme would be in effect upto 30 September 2020.
Know the senior citizens effective rate of interest for retail term deposits:
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Fixed Deposit with tenor ‘below 5 years’- 50 bps higher than the rate applicable for the general public.
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FD with tenor ‘5 years and above’ (new product)- 80 bps higher than the rate applicable for the general public (30 bps extra premium).
It is to be noted that this additional premium will not be payable in case of premature withdrawal of such deposits.
Presently, SBI is offering interest rate between 4 percent - 6.20 percent on FDs maturing in 7 days to 10 years.
Adding to it, SBI has lowered interest rates on FDs by 20 bps with effect from 12 May for up to 3 years tenor. This is due to the adequate liquidity in the system & with the bank. SBI has also declared the reduction in its MCLR by 15 bps across all tenors. As per the release, "The 1 year MCLR comes down to 7.25% per annum from 7.40 percent annum p.a. with effect from 10 May 2020."
