What are small finance banks?
Small Finance Banks are a new type of bank established by the RBI with the assistance of the government of India with the goal of promoting financial inclusion by primarily providing basic banking services to underserved and underrepresented groups. These banks can engage in all fundamental banking activities, such as lending and accepting deposits, just like regular commercial banks.
Small Finance Banks offer higher interest rates than most private banks. Here is the latest interest rate on savings accounts offered by Equitas, AU Bank, Ujjivan Bank, and Shivalik Small Finance Bank.
Equitas offers savings accounts with interest rates ranging from 3.50 percent to 7 percent. Interest will be calculated using the account’s daily closing balance. The bank makes quarterly interest payments via direct credit to the savings account. Note that the slab rates are applicable on the incremental amount based on the closing balance.
AU Small Finance Bank
interest on savings accounts will be calculated daily and paid monthly, i.e. at the end of each month. The bank offers interest rates ranging from 3.50 percent to 7 percent.
The interest rates are applicable for existing incremental balances that fall within the specified amount slab.
Ujjivan Small Finance Bank
interest on savings accounts accrues on day-end amounts kept in the savings account and is distributed quarterly. The higher interest rate will only be applied and paid based on balances that are kept in accordance with the slabs. The bank offers interest rates ranging from 3.50 percent to 7 percent.
According to the website, “Ex: If a customer maintains Rs.120,000/- in the savings account, 3.50% interest will be earned for Rs.100,000/- and 6.00% interest will be earned for the remaining Rs.20,000/-.”
Shivalik Small Finance Bank
Shivalik Small Finance Bank interest is based on day-end balances in savings accounts and paid out quarterly. Interest is calculated on the basis of incremental balance slabs. The bank offers interest rates ranging from 3.50 percent to 7 percent.