State Bank of India (SBI) customers will see three new changes in their personal banking from January 1, 2020: a new debit card, more secured facilities for cash withdrawal and lower interest rates on loans. Effective January 1, all old SBI debit cards with a magnetic stripe will be discontinued and replaced by a chip-based card. In terms of lending rates, SBI home loans linked to the external benchmark rate will become cheaper due to a reduction in the external benchmark rate (EBR). In another major change, SBI customers will now require a one-time password (OTP) at ATMs to withdraw money.

Here are the details of the three new changes for SBI customers:

OTP-based ATM cash withdrawal facility:

SBI in the last week of December announced the launch of an OTP-based ATM cash withdrawal facility from January 1. The OTP-based cash withdrawal service can be used for transactions above Rs 10,000 between 8 PM and 8 AM at SBI ATMs only. The customer will receive an OTP on the mobile number registered with the bank.

As per this process, once the cardholder enters the withdrawal amount, the ATM screen displays the OTP fields. The customer has to then enter the OTP received on the mobile number registered with the bank for getting the cash. The service is available across all SBI ATMs.

Lower interest rates on loans

SBI has reduced the external benchmark-based rate (EBR) by 25 basis points to 7.80 percent from 8.05 percent, effective January 1. "With this reduction, the interest rate for existing home loan customers as well as MSME borrowers who have availed loans linked to External Benchmark Based Rate would come down by 25 bps," said SBI in a statement.

The bank said its new home loans will offer interest rates starting from 7.9 percent from January 1, compared to 8.15 percent earlier.

The SBI's EBR is finalised at 265bps plus 5.15 percent repo rate of the Reserve Bank of India. The bank also charges 10-75bps premium for pricing the effective interest on the home loans.

New EMV chip and PIN-based SBI debit cards

SBI has discontinued all magnetic stripe debit cards from December 31, 2019, and asked its customers to avail the news EMV chip-based debit cards. “As per RBI guidelines, SBI has replaced all magnetic stripe debit cards with EMV chip & PIN-based cards,” said the bank in a notification on its website. The bank said the decision was taken in light of continuing instances of fraud on magnetic stripe cards.

First Published:Jan 1, 2020 12:09 PM IST