Union Bank ups deposit rates by up to 1 per cent

Interest rate for deposits from 91 days to less than six months has been increased by 1 per cent to 5.50 per cent while for deposits of one year but less than two years' maturity has been increased by 0.25 per cent, the bank said in a release issued here.

The rate hikes come into effect from September 1 and will be applicable to domestic term deposits of less than Rs 5-crore, it said. After the rate hike, deposits of between 15 to 45 days will fetch an interest of 3.5 per cent per annum, up 0.50 per cent while deposit rates of six months but less than nine months have been hiked to 5.75 per cent from the earlier 5 per cent.

Deposits for between nine months and one year are up 0.25 per cent from 5.75 per cent to 6 per cent, it said. UBI's peer from the public sector banks space, Punjab National Bank, also hiked its deposit rates today. A slew of banks, including State Bank of India, have hiked their deposit rates as the Reserve Bank of India has consistently tightened policy rates over the past few months.

Meanwhile, UBI has also introduced a new scheme called "Union Million Deposit" which will get an interest of 7.80 per cent. Under the new scheme, a  recurring deposit of 5,510 per month for 10 years or a one time deposit of Rs 4,61,861 will get the depositor Rs 10-lakh after ten years.