After SBI, Axis Bank cuts interest rate on savings account

Key Highlights:

• Axis Bank makes 50 bps revision in interest rates of savings bank account
• Axis Bank offers 3.50% interest rate on savings account balance up to Rs 50 lakh
• Axis Bank offers 4% interest rate on savings account balance above Rs 50 lakh

Axis Bank on Tuesday revised the interest rates on savings account with immediate effect. 

A person having savings account balance up to Rs 50 lakhs will now earn interest rate of 3.50% per annum - a cut of 50 basis points from previous rate. 

While balance of Rs 50 lakhs and above will continue to earn 4% interest per annum.

This move comes after State Bank of India (SBI) introduced two-tier interest rates on savings accounts. 

In SBI, a person with savings account balance of Rs 1 crore will continue to earn interest rates at 4% per annum, while a person holding balance below Rs 1 crore will only earn interest rate of 3.5% per annum. 

According to SBI, the reduction was on the back of large inflows in savings & current accounts during the demonetisation period in the months of November & December 2016. 

SBI said, "The decline in the rate of inflation, high real interest rates and the expected softening of interest rates are the other considerations warranting a revision in the rate of interest on savings bank."

Share price of Axis Bank was trading at Rs 497.80 per piece on BSE, down by Rs 9 or 1.61%. 

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