India cbank tightens rules on banks' large-value deposits

Last Updated: Thu, Jan 24, 2013 13:50 hrs

MUMBAI, Jan 24 (Reuters) - The Reserve Bank of India tightened the rules of offering differential interest rates on large size term deposits and also said banks can stop large depositors from premature withdrawal of their money.

Banks can charge different rates of interest only on bulk deposits of above 10 million rupees ($186,300), higher than previous limit of 1.5 million rupees, the central bank said in a circular on Thursday.

"For deposits below 1 crore (10 million rupees), the same rate will apply for deposits of the same maturity," the RBI said.

The RBI said banks can disallow premature withdrawal of deposits of over 10 million rupees.

The revised guidelines will be applicable from April 1. ($1 = 53.6850 Indian rupees) (Reporting by Suvashree Dey Choudhury; Editing by Gopakumar Warrier)

More from Sify: