Banks savings account rates: The 40 bps cut in the repo rate – the interest rate that the RBI charges for funds given to banks – will make funds cheaper for banks thus aiding them to bring down lending rates. This comes at a time when credit offtake is sluggish and investments have halted in the economy. EMIs on home, auto, personal and term loan rates are expected to come down in the coming days.

However, banks are also slashing deposit rates on various tenures to manage its asset-liability position. Savers and pensioners will see their returns coming down.

Also, Banks are slashing interest rates to encourage customers to hold less money in banks and promote spending. Other factors include excess liquidity with banks and low demand for fresh loans.

Here’s a list of banks that have cut savings account rates

State Bank of India: India’s largest public-sector lender State Bank of India (SBI) on June 2 reduced interest rate on savings bank deposits by 5 basis points to 2.70 percent per annum across all tenors. The revised interest rate is applicable from May 31, 2020. The bank has two slabs for savings bank deposits – balance up to Rs 1 lakh and those with above Rs 1 lakh balance.

It was the second reduction in fixed deposits (FD) rates by the lender in May. In April, the bank had reduced its savings bank deposits rate by 25 basis points to 2.75 percent per annum across all slabs.

Axis Bank: On June 1, Axis Bank slashed interest rate on savings account by 25 basis points (bps). The interest on savings account for balance up to Rs 50 lakh has been lowered to 3.5 percent. For balance above Rs 50 lakh, the interest rate stands at 3.5 percent.

Kotak Mahindra Bank: On balance up to Rs 1 lakh, Kotak Mahindra Bank ‘s interest rates on savings accounts slashed to 3.50 percent per annum on May 25. On balance above Rs. 1 lakh, the same is 4 percent. The interest rates will also be the same for the Basic Savings Bank Deposit Account/Small Account holders.

ICICI Bank: In a regulatory filing on June 2, ICICI Bank said it has cut the interest rates on saving deposits by 25 basis points (bps). The new rates will come into effect from June 4.

The private sector lender has cut the interest rates on all deposits of less than Rs 50 lakh to 3 percent, a reduction of by 25 bps as against the existing 3.25 percent.

Likewise, for deposits of Rs 50 lakh and above, the account holders will earn an interest of 3.50 percent, down from 3.75 percent currently.