A month after RBI's rate hike, banks start raising deposit rates as liquidity tightens, Bank of India latest to move Domestic banks are starting to raise their deposit rates due to tightening market liquidity conditions. The Bank of India recently announced an increase in interest rates on deposits for various periods, including a special option for 500 days. This decision reflects the increasing cost of deposits in the banking system with the increase in demand for credit. The liquidity of the banking system has decreased significantly from its peak in early September.