It has been reported that banks are reducing interest rates on the savings account. Lately two leading banks of the country kotak Mahindra bank and IndusInd bank have reduced the interest rates by 0.50% to 5% on the savings below Rs 1 lakh.

IndusInd Bank has slashed down the rates by1% to 4.5% on the daily savings up to Rs 1 lakh. Yes bank offers an interest rate of 6% on the savings up to Rs 1 lakh. After the RBI had deregulated savings bank account interest rate in Oct 2011 the banks are offering different interest rates.

Banks reported that this revision has not impacted much so far. However on the savings above Rs 1 lakh banks continue offer higher interest rates. Banks say that people who have less than Rs one lakh balance are generally not affected by a small revision in interest rate as the money in these accounts are generally for transactional purposes only .