Deregulation of interest rate is on our radar: RBI

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New Delhi, Sep 8: Interest rates on savings account may soon be deregulated as Reserve Bank of India (RBI) will appoint a working group to verify the possibility of deregulation.

RBI Deputy Governor Usha Thorat said, "Deregulation of interest rate is on our radar. A working group will soon be set up to examine the possibility of deregulating of interest rates."

Thorat also stated that they will examine whether the de-regulation can help in getting more customer into the formal banking system.

Currently, interest on savings accounts is the only regulated rate in the banking system.

Looking at the high growth in credit in recent years, Thorat also advised banks to do more "forward looking provisions" to cover their non-performing assets (NPAs) whose increase is "inevitable" in the future.

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