RBI Revises rules for Bulk Deposits.

The RBI has revised the rules for bulk deposits, offering differential interest rates, which would be applicable with effect from April 1.

RBI said,

• The Bank will have the freedom to determine its own penal interest rate of premature withdrawal of term deposits.
  
  The Bank shall ensure that the depositors are made aware of the applicable penal rate along with Deposit Rate.
• Th Bank at its discretion, would disallow premature withdrawal of large rupee term deposit of Rs 1 Crore and above.
  
  The Bank should however notify such depositors at the time of accepting such deposits.
• Banks can charge different rates of interest only on bulk deposits of above Rs 1 Crore compared to the previous limit of Rs 15 Lakh and above.
  
• For deposits below Rs 1 Crore of the same maturity, the same rate will apply.
  
• Banks should disclose in advance the schedule of interest rates payable on deposits, including deposits  on which differential  interest will be paid.
  
  Interest rate paid by the bank should be as per the schedule and should not be subject to negotiation between the depositor and the bank.
  

Courtesy: THE HINDU