This bank is changing method of calculating interest on higher savings account balances

RBL Bank has announced a change in the way interest on savings account balance will be calculated, effective May 1, 2025. Instead of applying a single interest rate to the entire balance, interest will now be calculated using progressive balance interest rate slabs, as per an email sent to customers by the bank.The interest will be calculated and accrued daily, based on the end of day balance in your savings account and will be paid / credited to your savings account on a quarterly basis.

Savings account interest rate up to 7.75%: These banks have revised savings account interest rate from April 1, 2025 RBL Bank Savings Account interest rate calculation from May 1, 2025Interest on the savings account balance up to Rs. 1 lakh will be calculated at 3.



25% per annum and interest on remaining balance will be calculated on progressive interest rate slabs effective May 1, 2025 How does calculation on progressive interest rate slabs work?Interest will be accrued daily based on the end-of-day balance in your account. The first Rs 1 lakh in your account will earn 3.25% interest per annum, but higher balances will earn progressively higher interest rates.

The accrued interest will be credited quarterly, on June 30, September 30, December 31, and March 31 each year.Also read: Lesser free cash transactions to be allowed in these Kotak Mahindra Bank accountsFor Example if your saving account balance is Rs 30 lakh, interest (per annum -PA)on it will be calculated as follows:First Rs 1 lakh Rs 3.25% PA interest Next Rs 4 lakh (Above Rs 1 lakh upto Rs 5 lakh) ? 4.

50% PA interestNext Rs 5 lakh (Above Rs 5 lakh upto Rs 10 lakh) ? 5.50% PA interestNext Rs 15 lakh (Above Rs 10 lakh upto Rs 25 lakh) ? 6.50% PA interestNext Rs 5 lakh (Above Rs 25 lakh upto Rs 30 lakh) ? 7.

50% PA interest. The 7.5% PA interest applies on balance above Rs 25 lakh upto Rs 3 crore.

Banks benefit from a progressive savings account interest rate structure because it allows them to control and optimize interest expenses. Instead of paying a high interest rate on the entire balance, they apply different interest rates to different portions of a depositor’s savings. This reduces the overall interest payout, making it more cost-effective for the bank.

How was it calculated till April 30, 2025Interest Rate Slabs for daily balances in savings account (Effective from Feb 15, 2025) Daily balances in Savings Account w.e.f.

February 15, 2025* Daily balance In Rs Applicable to balances Revised Interest rates p.a. Up to Rs 1 lakh Entire Balance 3.

25 Above Rs 1 lakh up to Rs. 5 lakh Balance > 1 lakh 4.5 Above Rs 5 lakh upto Rs.

10 lakh Balance > 1 lakh 5.5 Above Rs 10 lakh upto Rs. 25 lakh Balance > 1 lakh 6.

5 Above Rs 25 lakh upto Rs. 3 Crore Balance > 1 lakh 7.5 Above Rs.

3 Crore and upto Rs. 7.5 Crore Balance > 1 lakh 6.

5 Above Rs 7.5 Crore upto Rs.50 Crore Balance > 1 lakh 6.

25 Above Rs 50 Crore upto Rs. 500 Crore Balance > 1 lakh 6 Above Rs.500 Crore Balance > 1 lakh MIBOR+100 bps.