SBI to Reduce Interest Rates on Amrit Vrishti Special FD Scheme Starting June 15, 2025, the State Bank of India (SBI) has announced a 25 basis‑point cut in its 444‑day “Amrit Vrishti” Special Fixed Deposit (FD) scheme, lowering the rate from 6.85% to 6.60% per annum for general retail customers. This change takes effect on June 15, 2025, and continues to include the extra 0.50% interest benefit for senior citizens.
In this in‑depth guide, we’ll break down the context, explore the reasons behind the rate cut, compare SBI’s offering with peer banks, and provide a step‑by‑step guide on how to book or modify your deposit. You’ll also find tax‑planning tips, laddering strategies, an interest calculation example, a glossary of key terms, risk considerations, digital‑banking features, and a future outlook to make the topic approachable for everyone—from savvy professionals to curious 10‑year‑olds.
SBI to Reduce Interest Rates on Amrit Vrishti Special FD Scheme
| Parameter | Details | Reference |
|---|---|---|
| Effective Date | June 15, 2025 | SBI Official FD Page |
| Previous Rate (General) | 6.85% p.a. | RBI Monetary Policy |
| Revised Rate (General) | 6.60% p.a. | SBI Official FD Page |
| Rate for Senior Citizens (Revised) | 7.10% p.a. (6.60% + 0.50%) | SBI Official FD Page |
| RBI Repo Rate (After June Cut) | 5.35% | RBI Press Release |
| Tenor | 444 Days | SBI Official FD Page |
| Impact on ₹5 Lakh Deposit | Interest falls from ~₹39,464 to ~₹38,000 | Calculated example |
SBI’s decision to reduce the Amrit Vrishti FD rate by 25 bps to 6.60% (effective June 15, 2025) aligns with the RBI’s repo rate cut while preserving its broader deposit portfolio. Despite the lower yield, the scheme remains a strong choice for medium‑term, low‑risk savers—especially senior citizens who earn 7.10%. By understanding tax implications, employing laddering strategies, weighing risk considerations, leveraging digital banking features, and comparing peer offerings, you can make informed decisions to optimize your fixed‑income portfolio.
SBI Cuts 444-Day Amrit Vrishti FD Rates: Check New Returns on ₹2.5L, ₹4.5L & ₹6.5L Investments https://t.co/ASqOY4ZUSJ
— Newsd (@GetNewsd) June 15, 2025
Background: Why Is SBI Cutting Rates?
In its June 2025 Monetary Policy, the Reserve Bank of India (RBI) reduced the repo rate by 50 basis points to 5.35% in an effort to boost credit growth and support economic recovery. Following this move, commercial banks adjust their deposit and lending rates to reflect the new cost of funds. Major lenders like ICICI Bank and HDFC Bank trimmed comparable tenors by 20–30 bps, prompting SBI’s selective reduction of its Amrit Vrishti FD rate to stay competitive and manage liquidity effectively.
This targeted rate cut helps SBI balance its deposit attraction and funding costs while preserving margins on its other fixed‑income products.
What Is the Amrit Vrishti Special FD Scheme?
The Amrit Vrishti Special FD is a 444‑day deposit designed to bridge the gap between short‑ and long‑term investments. Its key features include:
- Tenor: 444 days
- Original Rate: 6.85% p.a. (general); 7.35% p.a. (senior citizens)
- Revised Rate: 6.60% p.a. (general); 7.10% p.a. (senior citizens)
- Minimum Deposit: ₹10,000
- Compounding: Quarterly for special tenors
- Premature Withdrawal: Allowed after 7 days with standard penalties
This medium‑term FD is popular for delivering higher yields than 1‑year deposits without locking funds for multiple years. It is suitable for investors who want a predictable return over about 15 months.
Old vs. New Rates: A Direct Comparison
| Customer Type | Previous Rate | Revised Rate | Change (bps) |
| General (Adults) | 6.85% | 6.60% | –25 |
| Senior Citizens | 7.35% | 7.10% | –25 |
Example Calculation (₹500,000 for 444 days, quarterly compounding):
- At 6.85%: ~₹39,464 interest
- At 6.60%: ~₹38,000 interest
- Difference: ₹1,464 less
Assumes no TDS; actual payout may vary based on tax status.
Practical Advice: Tax Planning & TDS
- Thresholds & Forms: Interest over ₹40,000/year (₹50,000 for seniors) attracts TDS at 10%. Submit Form 15G/H if below taxable income to avoid TDS.
- Effective Post-Tax Yield: Calculate yields after tax. For example, at 30% tax, 6.60% p.a. drops to ~4.62% net.
- Tax-Saving Alternatives: Consider 5‑year tax‑saving FDs (5.8% p.a.) under Section 80C if tax rebate matters.
- Reporting: Include FD interest in your annual ITR under “Income from Other Sources.”
Laddering Strategy: Balancing Liquidity & Yield
A laddering strategy splits your investment across different maturities to maintain liquidity while capturing varying rates:
- 1‑Year FD (6.75%): Good for short‑term goals.
- 444‑Day FD (6.60%): Medium‑term with slightly higher rate than 1‑year.
- 2‑Year FD (6.50%): Longer‑term security.
Stagger maturities every 6 months so you always have a portion maturing soon. This allows you to reinvest at the prevailing rate or use funds for expenses.
Step‑by‑Step Guide to Book or Modify Your FD
Step 1: Internet Banking Booking
- Log in to the SBI Personal Banking portal.
- Navigate to e-Services > Deposits > Fixed Deposit (Special).
- Select Amrit Vrishti – 444 days at 6.60%, enter amount, and confirm.
Step 2: Offline Branch Method
- Visit an SBI branch with your ID proof and deposit cheque.
- Fill the FD application specifying Amrit Vrishti – 444 days.
- Submit and collect the FD receipt with maturity date and rate details.
Step 3: Rollover/Renewal
- For maturing FDs on or after June 15, 2025, choose rollover at the revised rate via net banking or at branch before maturity.
Step 4: Premature Closure
- Use the ‘Close FD’ option in net banking or branch. Remember, early withdrawal penalties apply—typically a 1% to 1.5% rate reduction on the elapsed period.
Digital‑Banking Features & Alerts
- Mobile App Booking: Use the YONO SBI app to book or view FDs.
- E‑Mail & SMS Alerts: Get notifications for booking, maturity, and interest credit.
- Auto‑Renewal: Opt for auto‑renewal at maturity—either full amount or principal only while crediting interest to savings.
Comparing SBI’s Cut with Peer Banks
| Bank | 444-Day Rate | Senior Rate | Notes |
| SBI | 6.60% | 7.10% | Selective cut; other FDs unchanged |
| ICICI Bank | ~6.55% | ~7.05% | Broad cuts across tenors |
| HDFC Bank | ~6.50% | ~7.00% | Consistent trims after repo cut |
| Canara Bank | 6.75% | 7.25% | No change on 444-day tenor |
| Yes Bank | 6.85% | 7.35% | Premium risk-adjusted rates for long term |
Risk Considerations & Mitigation
- Inflation Risk: If inflation exceeds FD rate, real returns can be negative. Compare with inflation-linked bonds.
- Interest Rate Risk: Further rate cuts may reduce reinvestment returns.
- Liquidity Risk: Premature withdrawal penalties can reduce returns—ensure some liquid funds.
Future Outlook: What to Watch
- RBI Monetary Policy Meetings: Next meetings scheduled in August and October 2025—possible rate moves.
- Economic Indicators: Inflation trends, GDP growth, and credit offtake influence deposit rates.
- Digital Innovations: Watch for SBI’s new deposit products, such as dynamic rate FDs tied to external indices.
Alternatives to Consider
- Short-Term FDs (1 Year): 6.75% p.a. for greater flexibility.
- Senior Citizen Savings Scheme (SCSS): 8.2% p.a. government‑backed with 5‑year lock‑in.
- Tax‑Saving FDs: 5.8% p.a. with Section 80C deduction, 5‑year lock‑in.
- Debt Mutual Funds: Post‑tax yields of 7–8% but with NAV volatility.
- Small Finance Bank FDs: Up to 7.5–8% p.a. but higher credit risk.
Common Mistakes to Avoid
- Ignoring TDS: Always factor in tax deductions on interest.
- Skipping Rate Checks: FD rates change; verify before booking.
- One-Size-Fits-All: Match tenor with personal goals and liquidity needs.
- Overlooking Alternatives: Consider other instruments if you need tax benefits or higher returns.
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Glossary of Key Terms
- Basis Point (bps): One‑hundredth of a percentage point (0.01%).
- Tenor: Duration of the FD.
- TDS: Tax Deducted at Source on interest earnings.
- Repo Rate: Rate at which RBI lends to banks.
- Compounding: Earning interest on previously earned interest.
- Laddering: Splitting investments across multiple maturities.
Frequently Asked Questions (FAQs)
Q1: Why did SBI choose only the 444‑day FD to cut?
SBI manages cost of funds selectively, adjusting lower‑volume special tenors while keeping popular tenors steady.
Q2: How often is interest compounded on Amrit Vrishti FDs?
Interest is compounded quarterly for special tenors.
Q3: Can I open multiple Amrit Vrishti FDs?
Yes, there’s no limit—just adhere to the minimum deposit of ₹10,000 per FD.
Q4: What happens if RBI cuts rates again?
Banks typically follow within days. Future FD rates may fall further.
Q5: How do I avoid TDS on FD interest?
Submit Form 15G/H if your total interest income is below the taxable threshold.
Q6: What are the risks of investing in FDs now?
Main risks include inflation risk, interest‑rate risk, and liquidity risk if premature withdrawal is needed.
