SBI has said that Interest rates will remain high

By Pradeep Yuvaraj | July 3, 2011

A recent press report said that State Bank of India (SBI) has said that lending rates would continue to stay upward in the wake of growing inflation.

Mr. Pratip Chaudhuri, Chairman, SBI told the press that the interest rates are likely to remain high because of the high inflation. He said that the Reserve Bank finds it difficult to lower the interest due to the high inflation. He said that the bank has given up the pre-payment penalty on floating loans two months back. He also described the pre-payment penalty as an as anti-customer step.

Mr. Pratip Chaudhuri said he was confident that the bank would achieve good rate of growth in deposits and advances in current fiscal on the back of country’s expected 8 per cent growth in GDP. He said that the bank expects its deposits and loan to grow by 20 per cent in current fiscal.

Reports also said that SBI has planned to launch a new car loan product whereby it would charge Rs 1,700 as EMI on Rs 1 lakh loan with interest rate of 11.5 per cent per annum.

Mr. Chaudhuri said that the bank has decided to come out with an attractive product for car loan in which EMI will be Rs 1,700 per lakh. If someone taken a loan of Rs 3 lakh then they will have to pay close to Rs 5,000 as installment and the interest will also be calculated on daily balance.

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About Pradeep Yuvaraj

Pradeep Yuvaraj is a Co-Founder and Director at Finerva Financial Solutions Private Limited, a financial education company focused on personal finance education. He has penned over 250 articles relating to Personal Finance and clocked over 500 hours of educating individuals on managing personal finance. He is a serial entrepreneur and has been associated with 7 Start-ups. His entrepreneurial experience spans industries as varied as Education, Gas Engineering, Automobile Design, Software development and more recently a Pure play presentation design company. Prior to turning entrepreneur in 2005, he has worked for 3 of the top ten companies of the world - Shell, ExxonMobil and Total SA. This experience included handling Branch Operations, Channel Sales and Business Development across 5 states over a period of 8 years. He holds an MBA from Symbiosis and an Electronics Engineering Degree from the University of Pune.

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