HDFC Bank and ICICI Bank recently reduced their fixed deposit (FD) interest rates by 0.25 percent (25 basis points).
FD RATES: This reduction in FD interest rates by HDFC Bank and ICICI Bank is a significant indicator for depositors who view their investments as a safe and stable return option.
The Reserve Bank of India (RBI) recently cut the repo rate by 0.50 percent, leading banks to reduce their fixed deposit (FD) interest rates. This change has impacted the FD rates of major banks like HDFC and ICICI Bank, now offering lower returns to investors.
Changes in HDFC Bank's FD Rates
HDFC Bank has reduced its FD rates by 0.25 percent, effective June 10, 2025. Interest rates for general citizens now range from 2.75% to 6.60%, while senior citizens will receive rates between 3.25% and 7.10%. Specifically, the interest rate on FDs with a tenure of 3 to 5 years is now 6.80%, down from 7.05%. This change is effective from June 10, 2025.
Revisions in ICICI Bank's FD Rates
ICICI Bank has also reduced its FD rates by 0.25 percent. Interest rates for general citizens now range from 3% to 7.05%, while senior citizens will receive rates between 3.50% and 7.55%. For example, the interest rate on an FD with a tenure of 15 to 18 months is now 6.80%, down from 7.25%.
Impact of the Interest Rate Decline
The repo rate cut aims to increase liquidity in the economy and reduce the cost of borrowing. However, this results in lower returns for fixed deposit investors. Experts suggest that this is a suitable time for investors to leverage the currently high interest rates by investing in FDs for the long term.
Suggestions for Investors
- Invest in FDs for the long term: Take advantage of the currently high interest rates by investing in FDs for a longer duration.
- Compare rates across different banks: Compare FD rates from various banks and choose the most suitable option.
- Avail senior citizen schemes: Banks offer special FD schemes for senior citizens with higher interest rates.
