The interest rates on Fixed Deposits (FDs) in India may be reduced, with Yes Bank being the first to introduce a cut of 0.25% (25 basis points) on certain FD tenures. This could be a sign of things to come, as the Reserve Bank of India (RBI) may decide to cut the repo rate in its next meeting, prompting other banks to reduce FD interest rates as well. Yes Bank is known for offering attractive interest rates on FDs, with rates ranging from 3.25% to 7.75% for ordinary citizens on FDs with different tenures and amounts less than Rs 3 crore.
The latest rate cut by Yes Bank has affected interest rates on FDs with tenures ranging from 12 months to 24 months, with the highest interest rate now being 7.75%. Senior citizens can expect to earn 8.25% interest on FDs with the same tenure, down from 8.50% earlier. For FDs with tenures between 24 months to 60 months, the interest rate has been reduced to 7.25% from 7.50%. Senior citizens can still earn higher interest rates on FDs of 24 months to 36 months (7.75%) and 36 months to 60 months (8.00%).
Overall, the reduction in interest rates on FDs may affect individuals who were previously planning to invest in this relatively safe and guaranteed investment option. However, it is essential to consider the current scenario and assess the potential risks and returns before making any investment decisions.