What changed
RBI specified interest rates for the Special Deposit Scheme 1975 for calendar year 2012: 8.6% per annum for Q1 (Jan-Mar) and 8.8% per annum for the remaining nine months (Apr-Dec). Banks must disburse this interest on January 1, 2013, using electronic modes or account payee cheques, adhering to conditions from a 2003 circular.
What it means for you
Banks handling SDS 1975 accounts must ensure timely and accurate interest payment to depositors on the prescribed date. The step-up in rate from Q1 to Q2-Q4 reflects a change in applicable interest for the scheme. Non-compliance with disbursement timelines or modes could attract regulatory scrutiny.
What you must do
- Disburse SDS 1975 interest for CY 2012 at 8.6% (Jan-Mar) and 8.8% (Apr-Dec) on January 1, 2013.
- Use electronic modes (ECS/NECS/NEFT/RTGS) or account payee cheques for payment.
- Issue instructions to all deposit offices and acknowledge receipt to RBI.
- Refer to and comply with paragraphs 3 and 4 of circular CO.DT.No.15.01.001/H-3527/2003-04 dated Dec 30, 2003.
Who it affects
State Bank of India and its associates, Public sector banks listed in the circular, Deposit offices handling SDS 1975 accounts, SDS 1975 account holders
What are the interest rates for SDS 1975 for CY 2012?
Interest is 8.6% per annum from January 1 to March 31, 2012, and 8.8% per annum from April 1 to December 31, 2012.
When must the interest be paid to depositors?
Interest must be disbursed on January 1, 2013 itself.
Which payment modes are acceptable?
Electronic modes such as ECS, NECS, NEFT, RTGS, or account payee cheques are acceptable.