ouble your money the catch phrase which caught the nation's imagination in the nineties is making a comeback.
Union Bank of India has already mobilised Rs 1,100 crore under its latest scheme for depositors Jama Karo: Dugna Pao. The Dugna Pao offer promises to pay twice the amount after eight years and nine months, at an interest rate of 8 per cent per annum.
Semi-urban and rural people in Gujarat, Bihar, Uttar Pradesh, and Madhya Pradesh have been chasing the Union Bank offer. These states account for over 60 per cent of the total amount mobilised under the scheme by July 1.
This trend was last seen in the 1990s when the omnipresent National Savings Certificate (NSC) was ruling the savings universe in India. The department of posts had then offered to pay twice the money invested in NSCs in five years and a few months.
The people in the hinterland are not concerned about the rate of interest. They were drawn towards the offer just because of the overwhelming craving to double one's money, says a senior banker.
The Dugna Pao offer is an offshoot of the fight among banks for resources to meet the blazing credit growth. The race for garnering maximum retail resources in a rising interest rate scenario has seen banks offering rates which even a year back could not have been imagined by the savings community.
Other banks are offering an 8 per cent interest rate for shorter terms of deposits varying between nine and 13 months. Kotak Bank is offering 8 per cent on 290 days deposits, while IndusInd Bank is giving the same rate to its depositors for 270 days.
Among others, Yes Bank is offering 8 per cent interest for deposits of over 10 months, and ICICI Bank, India's second largest bank, is offering 8 per cent interest for deposits of about 13 months.