Mumbai: In June 2025, the Reserve Bank of India (RBI) lowered the repo rate by 50 basis points. In response, many leading banks reduced the interest rates on their savings accounts. This move has come as a disappointment for millions of account holders across the country who now earn less on their savings.
SBI Brings Down Rates for All Customers
The State Bank of India (SBI), the country’s largest public sector bank, has now made its savings account interest rate uniform at 2.5 percent per year. This new rate is effective from June 15, 2025. Earlier, SBI used to give 2.7 percent interest for balances below ₹10 crore and 3 percent for balances above ₹10 crore. Now, everyone earns the same lower rate, no matter how much they have in the account.
HDFC Bank Cuts Interest Across All Balances
HDFC Bank also reduced its interest rate on savings accounts from June 10, 2025. Now, all customers will get 2.75 percent interest per year, whether their balance is small or large. Previously, customers with ₹50 lakh or more earned 3.25 percent interest, while those with less earned 2.75 percent. After the change, the higher rate is no longer available.
ICICI Bank Follows the Same Path
ICICI Bank made similar changes effective from June 12, 2025. Like HDFC Bank, ICICI has now set a uniform rate of 2.75 percent per year for all savings account holders. Earlier, people with balances of ₹50 lakh and above received 3.25 percent interest, and others earned 2.75 percent. This change affects high-value depositors the most.
Other Banks Offer Slightly Better Rates
Some other banks are still offering slightly better interest, especially for higher balances:
Bank of Baroda: Offers between 2.7 percent and 4.25 percent (from June 12, 2025)
Federal Bank: Offers between 2.5 percent and 6.25 percent (from June 17, 2025)
IndusInd Bank: Offers between 3 percent and 5 percent (from June 16, 2025)
RBL Bank: Offers between 3 percent and 6.75 percent (from June 16, 2025)
These banks still give better returns for larger balances, which could attract new savers.
What This Means for You
If you have a savings account in SBI, HDFC, or ICICI, your interest earnings will now be lower. Many customers, especially senior citizens and those who keep high balances, will feel the pinch. People may now look at other banks or investment options for better returns.
