Bank of India Withdraws 400-Day FD Scheme, Slashes Deposit Rates Across Tenures

Bank of India (BoI) has said it will withdraw its special 400-day fixed deposit (FD) scheme and also reduce the rate of interest on its other deposit schemes. 

This came following the recent reduction in repo rate by the Reserve Bank of India (RBI) announced in the last Monetary Policy Committee (MPC) meeting held from April 7-9, 2025, which has prompted banks to reset their deposit and lending rates.

The 400-day special FD scheme came with the highest deposit rate of 7.30 per cent offered by the bank.

The withdrawal of this scheme marks a turn towards a lower interest rate in the wake of monetary easing.

From April 15, 2025, BoI will lower deposit rates on fixed deposits of less than Rs 3 crore as also on the Rs 3 crore to less than Rs 10 crore bracket. 

For small retail depositors of below Rs 3 crore, the new rate for FDs of 91 to 179 days will be 4.25 per cent, while 180 days to below one year will yield 5.75 per cent. 

Deposits for one year will still get 7.05 per cent, but the rate falls to 6.75 per cent for tenures ranging from 1-2 years.

Under the bulk deposit category, for amounts of Rs 3 crore to less than Rs 10 crore, BoI will pay 5.75 per cent for 91 to 179 days, 6.25 per cent for 180 to 210 days, and 6.50 per cent for 211 days to less than one year.

One-year deposits will still be making 7.05 per cent, while those between one year and less than two years will now make 6.70 per cent.

Super senior citizens (80 years and above) will get an extra 0.65 per cent, while senior citizens will get an extra 0.50 per cent on deposits up to Rs 3 crore with tenure of six months and more.

The revision reflects broader industry trends, where banks are adjusting their deposit offerings in line with changes in the RBI’s policy rate. The repo rate cut typically reduces borrowing costs for banks, prompting them to lower deposit rates to manage margins.

BoI’s latest move could also influence other banks to follow suit, potentially signalling a period of lower returns for fixed income investors. 

Customers looking to invest in FDs may now reassess their options in light of the reduced rates, possibly exploring alternative instruments or locking into longer tenures before further rate reductions occur.