Shock to Punjab National Bank customers: interest on savings account has been cut, new rates will be applicable from December 1

The country's second largest bank Punjab National Bank (PNB) has shocked the account holders. The bank has decided to cut the interest rates on the savings account. The bank has decided to reduce the savings account interest rates from 2.90 to 2.80% per annum. The new rates will be applicable from December 1.

With effect from 1st December 2021, the interest rate will be 2.80% per annum for savings account balance less than Rs 10 lakh in savings account. At the same time, for Rs 10 lakh and above, the annual interest rate will be 2.85%. Till now, 2.90% annual interest is being given on the deposit.

Under Section 80TTA of the Income Tax Act, income up to Rs 10,000 per annum from interest is exempt from tax in case of savings account of a bank. Its benefit is available to the person below 60 years of age. Whereas for senior citizens, this exemption is 50 thousand rupees. TDS is deducted if the income exceeds this. 10% TDS is deducted by the bank if the interest income exceeds the prescribed exemption limit.