The time for savings account holders to rejoice is nearing. As per the directives given by the RBI, all banks have to calculate interest on savings account holdings on a daily basis from 1st April 2010.
Currently banks calculate interest on the lowest available balance in customer's account from 11th to last day of a particular month.
The new system is surely going to bring a smile on the faces of customers as their earnings are going to increase with the implementation of the new system of interest calculation. A rough calculation shows that the customers are going to experience an approximate gain of 1.5 to 2.8 % depending on the nature of transactions, says an economist from a public sector bank.
"The new system is definitely going to benefit the customers," Mr Anil Girotra, Executive Director, Andhra Bank.
The high income groups especially those employed in IT firms and top executives from different sectors are expected to be major gainers as they usually maintain huge sum of money in their savings account.
According to the Managing Director of an SBI group bank, banks with large exposure to SB accounts would be ‘hit' as the cost of deposits would go up due to higher interest outflow.
Currently savings bank deposit amount to 21 to 25 % of the total deposits of banks.
"As of now the withdrawal patterns are quite varied. It remains to be seen how this would impact the interest outgo of the banks. We are expecting that educated customers, salaried class and business people may suitably change their approach to SB accounts to derive maximum benefit," the official said.
Mr Girotra said that with the implementation of the new system, there would be an additional load of 0.75 to 1% in savings bank accounts.
The banks would have to bear an additional load of 0.75 per cent to 1 per cent in the new system in SB accounts, Mr Girotra pointed out.