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Banks Revise Deposit Schemes to Attract Customers Amid Liquidity Shortage

Senior citizens receive an extra 0.5% on deposits up to three years and 0.6% on deposits over three years and up to five years. Super senior citizens enjoy an additional 0.1% on deposits with a tenure beyond one year

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Banks Revise Deposit Schemes to Attract Customers Amid Liquidity Shortage

Banks Revise Deposit Schemes to Attract Customers Amid Liquidity Shortage

As the banking sector continues to grapple with a liquidity shortage, leading banks are revising their deposit schemes, offering attractive rates and benefits to customers, including special tenure options, senior citizen perks, and bulk deposit schemes.

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IDBI Bank has introduced the 'IDBI Chiranjeevi-Super Senior Citizen FD' specifically designed for individuals aged 80 and above. This exclusive fixed deposit product offers an additional 65 basis points (bps) over the bank’s standard fixed deposit rates and 15bps over the senior citizen rates. Under the scheme, interest rates include 8.05% for a 555-day tenure, 7.9% for 375 days, 8% for 444 days, and 7.85% for 700 days. The scheme, effective from January 13, 2025, is aimed at providing higher returns to super senior citizens.

Meanwhile, the Bank of Baroda has introduced a liquid fixed deposit scheme, allowing customers to make withdrawals in units of Rs 1,000 after an initial deposit of Rs 5,000. Deposits exceeding Rs 5,000 must also be in multiples of Rs 1,000. Retail deposits, which are below Rs 3 crore, and bulk deposits, above this threshold, are part of the new offering.

The tenure for Bank of Baroda’s liquid fixed deposits ranges from 12 to 60 months, with interest rates aligned with prevailing rates. In addition, senior and super senior citizens are offered additional interest. Senior citizens receive an extra 0.5% on deposits up to three years and 0.6% on deposits over three years and up to five years. Super senior citizens enjoy an additional 0.1% on deposits with a tenure beyond one year.

Both banks’ moves come as part of their efforts to attract customers amid stiff competition for deposits and to provide better returns to senior citizens, a growing demographic in India’s banking system.

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Bank senior citizens Liquidity Facility