Banks to calculate interest rates on a daily basis for savings and salary accounts:
Salary and savings account holders could witness their interest income rise by 25 per cent under the new daily average method proposed by the Reserve Bank of India for computation of interest on savings accounts, according to rating agency Crisil.
New RBI rule:
According to the new RBI rule from April 1, banks will compute the annual 3.5 per cent interest rate on savings accounts on a daily basis instead of taking the lowest deposit during a month.
Crisil said the new method of interest computation will increase the effective interest rate on savings balances, particularly for salary account holders. “It is estimated that for a salary account holder with a minimum savings balance between 1-2 times of the monthly salary, the increase in interest income will be between 10 and 25 per cent,'' it said.
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