IDFC First Bank revises savings account interest rates up to 6.5% from January 9

IDFC First Bank interest rate hike

• IDFC First Bank revises savings account interest rates effective January 9, 2026
• Rates up to 6.5% for balances between Rs 10 lakh and Rs 10 crore
• Interest is calculated daily and credited monthly as per RBI guidelines

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IDFC First Bank has revised the interest rates on its savings accounts, with the new rates coming into effect from January 9, 2026. The bank continues with its progressive interest rate structure, where different portions of the account balance earn different rates, rather than a single flat rate on the entire amount.

Under this structure, balances of up to Rs 1 lakh earn 3 percent per annum, while the portion of the balance above Rs 1 lakh and up to Rs 10 lakh earns 5 percent. The highest rate of 6.5 percent applies to balances between Rs 10 lakh and Rs 10 crore.

For larger balances, the interest rate gradually tapers off, with balances above Rs 10 crore earning lower rates.

How progressive interest works

With a progressive structure, the higher rate applies only to the portion of the balance that falls within a specific slab, not the entire balance.

For instance, if your savings account balance is Rs 10 lakh, the bank will pay:

• 3 percent on the first Rs 1 lakh, and
• 5 percent on the remaining Rs 9 lakh.

Similarly, a balance of Rs 1 crore earns:

• 3 percent on the first Rs 1 lakh,
• 5 percent on the next Rs 9 lakh, and
• 6.5 percent on the remaining Rs 90 lakh.

This structure benefits customers who maintain higher balances, as the incremental amount earns a better return without affecting the lower slabs.

Interest calculation and payout

As per RBI guidelines, savings account interest is calculated on a daily end-of-day balance and credited monthly. IDFC First Bank calculates interest on a 365-day basis in non-leap years and 366 days in leap years, with the final interest rounded to the nearest rupee.

What does this mean for bank account holders?

While the revised rates may benefit higher balances, savings accounts are still best used for liquidity. For surplus funds not needed immediately, liquid mutual funds can offer relatively better returns while still allowing easy access to money. These funds invest in short-term debt instruments, focus on capital preservation, and can be a more efficient option than letting excess cash sit idle in a savings account.