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CCI to end probe into PSB cartelisation

It is probing if public sectors banks, are conniving to keep the interest rates on savings accounts low

Policy Pulse
Publish Date: Sep 15 2016 1:43PM | Updated Date: Sep 15 2016 1:43PM

CCI to end probe into PSB cartelisation

 The Competition Commission of India (CCI) may complete its investigation into alleged cartelisation by state-run banks within two months. 

 
It is probing if public sectors banks, are conniving to keep the interest rates on savings accounts low at about 4 percent when private sector lenders are providing more, a ‘The Economic Times’ report has said.
 
"The investigation is likely to complete in two months. All public sector banks are offering almost same interest rate at a time when some private banks are offering 6%," a top CCI official told the paper.
 
Till October 2011, all banks including private sector lenders, were required to pay only 4 percent as interest on savings accounts. 
 
After that the Reserve Bank of India gave permission to banks banks to fix their own rates. 
 
The central bank  had hoped that deregulation of interest rates on savings bank accounts would help savers, as it would allow lenders to come out with innovative products to entice more funds from households with low incomes.