What You Need To Know About Paytm Payments Bank's On-Demand Fixed Deposit Paytm Payments Bank has also cut savings rate after RBI's repo rate cut
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Paytm Payments Bank (PPB) on Thursday announced a cut in savings account rate of 50 basis points (bps), from 4 per cent to 3.5 per cent, effective from November 9, 2019. Satish Kumar Gupta, MD & CEO of Paytm Payments Bank said that this cut comes after the Reserve Bank of India's (RBI) successive cuts in repo rate this year. "RBI has recently cut the repo rate by 25 basis points to 5.15 per cent, which takes its cumulative cuts so far in the last 12 months to 135 basis points. Repo rate cuts have prompted PPB's move."
Along with the savings rate cut, the country's largest payments bank has also announced the launch of on-demand fixed deposits (FD) for its users. Customers will be able to create an FD of any amount with their respective banks that are in partnership with PPB. Currently, any amount exceeding INR 1 lakh limit on saving account deposit is automatically converted into an FD via auto-sweep into PPB's partner bank.
Interest rate on on-demand FD will be up to 7.5 per cent and depositor will be able to redeem partial or full amount at any time, free of charge. "We are focussed on our mission to bring financial inclusion in every nook and corner of our country, and believe everyone should be able to access simple financial instruments at low cost. Our offering of on-demand FD will enable our customers to create fixed deposits—starting from as low as INR 1—and earn an interest of up to 7.5 per cent," says Gupta. On-demand FD will be launched in November.
Paytm was also the first player in the market to offer digital gold, making gold buying, selling and storage easily accessible for everyone. Users can buy gold for as little as INR 1 and hold it for as long as they want. There is no storage cost to be paid.
