SBI hikes interest rate on short-term deposits to 8%

State Bank of India hiked interest rates on retail term deposits having maturity periods of less than one year by 25-100 basis points.

The bank announced this in a notice to the Bombay Stock Exchange, on Tuesday.

The interest rate on deposits having maturity periods ranging between seven days and less than one year has been hiked to a uniform 8 per cent.

According to an official from the bank the hike is to boost deposit growth as the financial year draws to a close.

Banks are also revising short-term deposit rates upwards as they are facing liquidity crunch. On Tuesday banks borrowed a total of Rs 1.78 lakh crore from the RBI through the repo auction. On Monday, the borrowing had touched a record high of Rs 1.95 lakh crore.

priyan@thehindu.co.in