BANKING GENERAL KNOWLEDGE
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Question
[CLICK ON ANY CHOICE TO KNOW THE RIGHT ANSWER]
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RBI
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Government of India
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Indian Banks Association
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Bank Itself
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Detailed explanation-1: -With effect from October 22, 1997, RBI has given the freedom to commercial banks to fix their own interest rates on domestic term deposits of various maturities with the prior approval of their respective Board of Directors/Asset Liability Management Committee (ALCO).
Detailed explanation-2: -Interest rates are determined, in large part, by central banks who actively commit to maintaining a target interest rate. They do so by intervening directly in the open market through open market operations (OMO), buying or selling Treasury securities to influence short-term rates.
Detailed explanation-3: -Accordingly, the Reserve Bank, with effect from July 1, 1977, fixed the interest rate on savings deposits with cheque facilities, considered as transactions-oriented accounts, at 3.0 per cent and the interest rate on savings deposits without cheque facilities, considered as pure savings accounts, at 5.0 per cent.
Detailed explanation-4: -Reserve Bank of India-Lending Rates.
Detailed explanation-5: -There are two main factors that will influence how high (or low) the bank interest rate on your term deposit is – the length of the term and the amount of the deposit. Generally, you can expect a higher bank interest rate if you invest your money for longer.