Axis Bank cuts savings bank deposits rate to 3.5% on deposits below Rs 50 lakh

Bank to continue to pay 4% interest on deposits of above Rs 50 lakh

economy policy: Private sector lender Axis Bank has reduced interest rate on savings bank accounts by 50 basis points to 3.5 per cent for deposits up to Rs 50 lakh.

However, the bank will continue to pay four per cent interest on deposits of above Rs 50 lakh. The new interest rates will be effective from August 8, Axis Bank said in its filing with the BSE.

Axis Bank’s action follows the decision by State Bank of India (SBI) and Bank of Baroda to reduce rates on savings deposits. SBI was the first bank to cut the savings deposit rate by 50 basis points to 3.5 per cent for deposits up to Rs 1 crore. Bank of Baroda had cut the rate to 3.5 per cent on deposits of up to Rs 50 lakh.

While Kotak Mahindra Bank retained the existing rates of five per cent on savings deposits up to Rs 1 lakh and 6 per cent on deposits between Rs 1 lakh and Rs 1 crore, it reduced the rate on savings deposits of amounts above Rs 1 crore and up to Rs 5 crore from six per cent to 5.5 per cent. The interest rate on deposits of over Rs 5 crores was retained at 5.5 per cent. Karnataka Bank, too, had tweaked the interest rate on savings deposits.

SBI Managing Director Rajnish Kumar had said that it was a choice between increasing MCLR (marginal cost of funds-based lending rate) or reduce the savings bank rates.

A hike in lending rates would have meant an increase in equated monthly instalments (EMIs) for retail, small and medium enterprises, and farm loans. SBI opted to cut savings rate, helping to maintain MCLR at the existing level, he said.

Jan Dhan deposits touch Rs 64,564 cr; Rs 300 cr added during demonetisation

PSBs account for Rs 50,800 cr, rural banks for Rs 11,683 cr, private banks for Rs 2,080 cr

 

Deposits in Jan Dhan accounts have touched a new high of Rs 64,564 crore, of which over Rs 300 crore came in the first seven months of demonetisation, according to government data.

The Pradhan Mantri Jan-Dhan Yojana (PMJDY), Prime Minister Narendra Modi's pet scheme, aims at bringing hitherto unbanked areas and people under a formal banking system. Bank accounts can be opened with a zero balance under the PMJDY.

Finance ministry data, accessed through a Right to Information (RTI) application filed by a PTI correspondent, show that there were about 28.9 crore PMJDY accounts on June 14 this year.(economy policy)

Of these, 23.27 crore accounts were with public sector banks, 4.7 crore with regional rural banks and 92.7 lakh with private ones.

These accounts together have deposits of Rs 64,564 crore, the Finance Ministry data show. Public sector banks account for Rs 50,800 crore, regional rural banks for Rs 11,683.42 crore and private banks, Rs 2,080.62 crore.

On November 16, 2016, there were 25.58 crore PMJDY accounts with an aggregate deposit of Rs 64,252.15 crore, Minister of State for Finance Santosh Kumar Gangwar had told the Lok Sabha.

Thus, between November 16 last year and June 14 this year, Rs 311.93 crore had been added to Jan Dhan accounts.

The PM had on November 8 last year announced the demonetisation of 500-rupee and 1,000-rupee notes.

Following reports of alleged misuse of Jan Dhan accounts to convert black money into white after the note ban, the government had warned people that they would be penalised if they indulged in such activities.

In a press release issued on November 18, the government had said, "There are some reports received that some people are using other persons' bank accounts to convert their black money into new denomination notes."

This, it had said, had also been reported in Jan Dhan accounts.

The government had said such activities could attract penalty if it was established that the amount deposited in the account did not belong to the account holder.

"Also the person who allows his or her account to be misused for this purpose can be prosecuted for abetment under the Income Tax Act," it had said.

Alongside other facilities, PMJDY accounts also allow an overdraft facility of up to Rs 5,000 in one account per household, preferably held by a woman member.

Banks can deposit banned Rs 500, Rs 1,000 notes with RBI by July 20: Govt

This is the second window the government has provided to banks, post offices and cooperative banks

The government has permitted banks and post offices to deposit junked Rs 500 and Rs 1,000 notes with the Reserve Bank by July 20.|economy news  

This is the second window the government has provided to banks, post offices and cooperative banks for depositing the junked notes with RBI.

The earlier window was open till December 31, a day after the 50-day period of demonetisation of high value currency.

"Such specified bank notes may be deposited by such bank, post office or district central cooperative bank, as the case may be, in any office of the Reserve Bank, within a period of 30 days from the commencement of these rules," said a government notification.

It further said that they should get the exchange value by credit to the account of such subject to the satisfaction of the RBI of the conditions specified.|economy policy

RBI will accept deposits collected by any bank or post office by December 30, 2016 or by any District Central Cooperative Bank from November 10-14, 2016 should be deposited within 30 days, the notification said.

They should also cite valid reasons for non-deposit of the specified bank notes within the period, it said.