gs1medium

In India, the interest rate on savings accounts in all the nationalized commercial banks is fixed by

  1. A.Union Ministry of Finance
  2. B.Union Finance Commission
  3. C.Indian Banks' Association
  4. D.None of the above
▶ Answer & Explanation

Correct answer: D. None of the above

Prior to the liberalization of the financial sector in the early 1990s, interest rates, including those on savings accounts, were often administered. However, with reforms, the Reserve Bank of India (RBI) was empowered to set these rates. Subsequently, even this role has been largely deregulated, with banks now having the freedom to determine their own savings deposit interest rates, subject to overall monetary policy guidelines.

Source: UPSC gs1 2010

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