In a significant move, the Reserve Bank of India (RBI) has decided to substantially increase the bulk deposit limit for large urban co-operative banks (UCBs). The new limit now stands at ₹1 crore and above, a notable surge from the previous threshold of ₹15 lakh and above.
The enhanced bulk deposit limit is specifically applicable to UCBs falling within the Tier 3 category, characterized by deposits ranging from ₹1,000 crore to ₹10,000 crore, and Tier 4 category, encompassing UCBs with deposits exceeding ₹10,000 crore.
Previously, a deposit of ₹15 lakh and above was considered a bulk deposit across all UCBs, allowing discerning customers to negotiate interest rates with the banks. However, with the revised threshold set at ₹1 crore and above, customers depositing amounts below this limit will now earn a uniform rate of interest.
Co-operative banking experts suggest that this adjustment in bulk deposit limits will bring about a standardized approach to interest rates for deposits below ₹1 crore, streamlining banking interactions. It is noted that for all other UCBs, excluding scheduled UCBs in Tiers 3 and 4, the definition of bulk deposit remains unchanged as “single rupee term deposits of ₹15 lakh and above,” ensuring continuity for a majority of co-operative banks.
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