I convinced a few of my friends to join hive for 20% APR from HBD. They are not active here and are passive investors. Reducing the APR would let them leave and I'm sure that would be the case with other passive investors too.
Indians get 14% returns from this investment after our 30% tax. If the APR is reduced to 12%, the return is something that is already available in some safe investment schemes in the real world. So people might prefer that and take their HBD out.
12% yield on the dollar is an amazing return. My witness node is set to 16% but even if we go for 10%, which other witnesses are going for, it is still an amazing return.
India and Brazil seem to be similar in many aspects, Brazil has a 13% return, you said India has 14%, all my friends and I would rather take 10% on our US Dollar investment over 13% on our Brazilian Real investment just because historically the USD has outperform the BRL. I assume the 14% is on the Indian Rupee, right? I am not from India, but to me 12%, or even 10% on the USD sounds more attractive than 14% after tax on the INR.
Point is, even lowered HBD savings is among the best in the world and in the DeFi space. Your friends are allowed to leave, but in my opinion they will be missing out on great savings. Are you sure they would really honestly leave the double digit interest in USD? I wouldn't, my friends neither.