Bank of India on Thursday launched a 444-day term deposit scheme with a rate of interest of 5.50 per cent per annum. Senior citizens will receive an additional 0.50 per cent per annum on this term deposit.
The public sector bank also revised the rate of interest on fixed deposits (FDs) of different terms.
The state-owned bank is the latest among public sector banks to increase deposit rates for its customers. After the Reserve Bank of India (RBI) increased repo rates by 90 basis points (bps) over the last two months, several public and private sector banks, such as the State Bank of India, Canara Bank, Punjab National Bank, HDFC Bank, ICICI Bank, among others increased their lending as well as deposits rates.
Repo rate is the rate at which RBI lends to banks. A hike in repo rate leads to a hike in lending as well as deposit rates. For the uninitiated, one basis point equals 0.01 percentage point.
The bank announced in a press release that this special term deposit scheme is being launched in anticipation of the bank’s 117th Foundation Day, which will be celebrated on September 7, 2022, in order to reaffirm its commitment to passing on the benefits of policy rate changes to its customers and the general public.
The offer is available for a limited period of time and will be accessible at all Bank of India branches and online platforms, the statement said.
Incidentally, Bank of India has also increased the rate of interest on term deposits of various maturities by up to 40 basis points. Under this special scheme, senior citizens will be provided with an additional 0.50 per cent interest per annum.
It further announced that there will be no penalty for early withdrawal, where deposits have been prematurely closed for renewal for a longer duration than the remaining time of the initial tenure.
The bank was recently in the news for its ‘Branch Adalat’ campaign. The purpose behind the campaign was to provide relief to borrowers affected by the Covid-19 pandemic or any other reason, especially those borrowers having outstanding loans up to Rs.5 crore under agriculture, micro small and medium enterprises (MSMEs), retail, and personal loan segments.
