Savings account interest rate ads – Time for a disclaimer

As RBI deregulated, the interest rate for deposits in savings account, Indian Banks have started competing to woo the customers with attractive rates. While Kotak is flashing its 50% extra campaign for its 6% interest rate all over, Yes Bank, raised its pitch with 100 more basis points at 7% rate for deposits more than 1 lakh.

Not long ago, savings rate had remained constant at 3.5% for more than 8 years. Customers who are not aware of the recent deregulation policy by RBI could very well believe this 6 or 7% as the new reality and might think that it will remain at this level for many years.

Its better for the banks who advertize higher savings account interest rates to add a disclaimer, as in the end it will affect the bank’s brand image too as customers will feel cheated when the rates begin to drop to lower levels. Its time for a clear disclaimer to these savings rate ads in the line of Mutual Fund ads.

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