Mumbai, April 15 -- Banks have started lowering deposit rates after sitting on the fence for months, waiting for the liquidity to be in surplus and credit growth to ebb.

With both conditions now met, banks have taken the cue from the Reserve Bank of India's (RBI) repo rate cut of 25 basis points (bps) last week. While the liquidity surplus stood at Rs.2.08 trillion on 10 April, non-food credit growth slowed to 10.9% year-on-year (y-o-y) as of March end, almost half of what it was a year earlier.

State Bank of India, Bank of India and Kotak Mahindra Bank have slashed interest rates on fixed deposits following the repo rate cut.

India's largest lender SBI cut term deposit rates by 10 basis points (bps), while Bank of India has reduced ra...