FD Interest Rates

Fixed Deposit Rates of All Banks

Banks FD Rates Tenure
SBI 4.50% - 6.50% 7 days to 10 years
Bajaj Finserv 7.60% - 8.35% 1 year to 5 years
HDFC 7.50% - 7.75% 33 months to 66 months
PNB Housing Finance 7.75% - 8.20% 1 year to 10 years
ICICI Bank 4.00% - 6.90% 7 days to 10 years
Axis Bank 3.50% - 7.15% 7 days to 10 years
IDFC First Bank 4.00% - 8.00% 7 days to 10 years
Earn upto 8.35% on FD

Fixed Deposit Interest Rates Comparison 2020 in India

Bank FD Rate of Interest Senior Citizen FD Rates
SBI Fixed Deposit 4.50% - 6.00% 5.00% - 6.50%
HDFC Bank Fixed Deposit 3.50% - 6.40% 4.00% - 6.90%
ICICI Bank Fixed Deposit 4.00% - 6.40% 4.50% - 6.90%
Axis Bank 3.50% - 6.50% 3.50% - 7.15%
Kotak Bank 3.50% - 6.20% 4.00% - 6.70%
IDFC First Bank 4.00% - 7.50% 4.50% - 8.00%
Bank of Baroda 4.50% - 6.25% 5.00% - 6.75%
Citibank 3.00% - 5.25% 3.50% - 5.75%
IDBI Bank 3.50% - 6.30% 4.00% - 6.80%
Indian Bank 4.50% - 6.30% 5.00% - 6.80%
Indian Overseas Bank 4.50% - 6.40% 5.25% - 7.15%
OBC 4.50% - 6.25% 5.00% - 6.75%
PNB 4.50% - 6.05% 5.00% - 6.55%
HDFC 7.50% - 7.50% 7.75% - 7.75%
PNB Housing Finance 7.75% - 7.95% 8.00% - 8.20%
Allahabad Bank 4.95% - 6.45% 4.95% - 6.45%
Andhra Bank 3.50% - 6.10% 4.00% - 6.60%
Bank of India 4.25% - 6.30% 4.75% - 6.80%
Bank of Maharashtra 4.25% - 6.00% 4.25% - 6.50%
Canara Bank 4.50% - 6.30% 5.00% - 6.80%
Central Bank of India 4.50% - 6.20% 5.00% - 6.70%
Punjab and Sind Bank 4.00% - 6.20% 4.50% - 6.70%
UCO Bank 4.50% - 6.20% 4.75% - 6.70%
Union Bank of India 4.50% - 6.25% 5.00% - 6.75%
United Bank of India 4.00% - 6.50% 4.00% - 6.50%
Lakshmi Vilas Bank 4.50% - 7.80% 4.50% - 8.40%
Equitas Small Finance Bank 5.00% - 8.25% 5.60% - 8.85%
Jana Small Finance Bank 5.00% - 8.50% 5.60% - 9.10%
DHFL 8.50% - 9.25% 9.00% - 9.75%
Karnataka Bank 3.50% - 6.50% 4.00% - 7.00%
DBS Bank 4.00% - 6.25% 4.00% - 6.25%
Jammu And Kashmir Bank 4.50% - 6.30% 5.00% - 6.80%
Ujjivan Small Finance Bank 5.50% - 8.10% 6.00% - 8.60%
Fincare Small Finance Bank 4.00% - 9.00% 4.50% - 9.50%
Karur Vysya Bank 4.40% - 6.30% 4.40% - 6.80%
Yes Bank 5.00% - 7.50% 5.50% - 8.00%
Syndicate Bank 4.50% - 6.30% 5.00% - 6.80%
Standard Chartered Bank 4.25% - 6.60% 4.25% - 6.60%
Dhan Laxmi Bank 4.00% - 6.90% 4.50% - 7.40%
Bajaj Finserv 7.60% - 8.10% 7.85% - 8.35%
LIC Housing Finance 7.50% - 7.60% 7.75% - 7.85%
Federal Bank 3.50% - 6.50% 4.00% - 7.10%
AU Small Finance Bank 5.25% - 7.77% 5.75% - 8.27%
Corporation Bank 4.55% - 6.45% 5.05% - 6.95%
IndusInd Bank 4.00% - 6.75% 4.50% - 7.25%
ESAF Small Finance Bank 5.50% - 8.00% 6.00% - 8.50%
RBL Bank 5.00% - 7.45% 5.50% - 7.95%
HSBC Bank 3.00% - 5.75% 3.50% - 6.25%
DCB Bank 5.40% - 7.60% 5.90% - 8.10%
South Indian Bank 4.00% - 6.55% 4.50% - 7.05%
Bandhan Bank 3.50% - 6.75% 4.25% - 7.50%

Among banks, Lakshmi Vilas Bank offers the highest FD rate of 7.80% for deposits with a tenure of 450 days. FD rates of banks are determined by changes in RBI monetary policy such as repo rate, base rate etc, internal liquidity position of banks, economic conditions and the level of credit demand. FD interest rates of different banks in India vary by deposit amount, deposit tenure and type of depositor.
If you compare fixed deposit rates of NBFCs and HFCs in the table above, DHFL offers the best FD rate of 9.25% for deposits with a tenure of 36 months. FD rates of NBFCs and HFCs are higher than the bank FD rates, which are risk free deposits. The risk on FDs of NBFCs and HFCs correspond to the credit ratings assigned to these deposit schemes.

Highest FD Interest Rates

FD Rates Highest FD Rate Banks with highest FD rate
1 year FD 8.00% Jana Small Finance Bank, Ujjivan Small Finance Bank
5 year FD 8.25% Jana Small Finance Bank

At the bank FD rates in 2020, top banks for 1 year FDs are Jana Small Finance Bank, Ujjivan Small Finance Bank as they offer highest interest rate of 8.00 on regular term deposits. For 5 year FD, Jana Small Finance Bank should be your top choice as it’s rate of interest is maximum at 8.25%.

Bank FD Interest Rates 2020

Bank FD is a risk-free investment. As a depositor, you need to be careful before choosing FDs of non banks, as they carry market and credit risk. The level of risk with them is reflected in the credit ratings assigned to these fixed deposits.
Bank FDs being risk free, are not required to get a credit ratings done and also offer slightly lower interest rates than that of FDs of non banks.

Bank FD interest rates varies by the amount deposited, tenure of deposit, and type of depositor.

  • Deposit Amount: Banks offer lower interest rate on bulk deposits of more than Rs 1 crore and high interest rate on deposits of less than Rs 1 crore.
  • Deposit Tenure: Banks offer lower rate of interest on deposits with a shorter tenure. Based on current rates, the highest rate on FDs with a tenure of less than 1 year is 8.00% and highest FD interest rates on the tenure of 10 years is 7.75%
  • Depositor Type: All banks in India offer higher interest on senior citizens FDs. Currently, the interest rate on senior citizens FDs ranges from 3.50% to 9.75% depending on the deposit amount and deposit tenure.

Bank Fixed Deposit Scheme

A fixed deposit (FD) is a type of deposit account provided by banks for a fixed tenure at a fixed rate of interest. In this scheme, the depositor keeps a fixed amount of money in an account known as FD account. The money is deposited only once at the time of account opening. At the end of the tenure, the interest amount is calculated on the principal amount and the total sum, including interest, is paid back to the depositor cumulatively. A fixed account earns higher interest rates than a regular savings bank account.
Fixed Deposits are also known as ‘term deposits’ or ‘time deposits’. If you wish to deposit additional amount in fixed deposit, you need to open another FD account. Term deposits are considered safest investment option compared to other savings instruments. Its duration of a fixed deposit may vary from 7 days to 10 years. The rate of interest on these deposits is based on the tenure and bank’s interest rates policies. Key features are:

  • It can be opened by all residents, including minors and HUFs.
  • Allows choosing 2 nominees in application form eligible to receive the FD amount after the death of the holder by submitting a valid death proof.
  • It does not allow to withdraw deposit amount before maturity. Hence, it encourages a depositor to save. Premature withdrawals from FD are allowed in emergencies by paying the penalty.
  • Banks also offer Sweep-in facility on term deposits, which allows the depositor to interlink their savings bank account to a fixed deposit account. This unique facility on FD facilitates the automatic transfer of surplus funds from savings account to FD account, thus allowing you to earn FD rates on your savings with an option to break the FD anytime and use the amount for your expenses.
  • You can also avail of loans on your fixed deposits to meet any financial emergency. In loan against FD, your deposit is the security for the loan. Depending upon the bank, you would get a loan on your FD up to the extent of 75-95% of the FD amount, which varies from one lender to another. Rate of interest on FD loans are 1%-1.5% higher than your FD rate.

Fixed Deposit Interest Rates for Senior Citizens

Interest offered on senior citizen FDs is slightly higher than what is offered to other individuals. Senior citizens are required to submit their age proof to avail the benefits of senior citizen FDs. 

  • Age of senior citizen should be 60 or more on the date of investment.
  • Tenure on senior citizens FD is between 7 days to 10 years in most of the banks.
  • Senior citizens FDs earn 0.25% to 0.75% higher interest compared to regular deposit rates.
  • Loans against FDs are available on senior citizen FD.
  • Penalties are applicable in case of premature withdrawal of FDs of senior citizens as applicable to other regular accounts.
Timely Closure

Closing your fixed deposit account at the time of its maturity is timely closure. While closing your FD upon its original maturity, the bank will pay you back the principal amount along with the interest on your deposit.

Breaking of FD account

Breaking a fixed deposit account means withdrawing the entire sum of money before its maturity. This is allowed from time to time and the withdrawal rules may vary from one bank to another. Banks usually levy a penalty at the time of breaking your FD account or pre closing it before attaining the original maturity and it pays you back the principal and interest either at a lower interest rate or after deducting a penalty on your FD. However, some banks including Yes Bank and Bank of Maharashtra waive off interest penalty on FD if the liquidation is due to some emergency.

Part withdrawal

Partial withdrawal allows you to withdraw a certain amount of money from your fixed deposit account. You can use these funds either for emergencies or take advantage of a higher rate of interest, which is offered by some other bank at the same time. It is generally allowed in units of Rs. 1,000 and a penalty of 1% is levied by the banks and the remaining balance amount which is lying in your fixed deposit account continues to earn the original rate of interest. Most of the banks allow the facility of part withdrawal with some penalty, and there are few banks which do not allow to withdraw any amount during the deposit tenure.

FD Interest Rates Calculator

Using the FD calculator, you can find out the total interest you will earn at the end of tenure.

The formula for calculating fixed deposit interest rates is shown below
A = P * (1+ r/n) ^ n*t
I = A – P
A = Maturity value
P = Principal amount
r = rate of interest
t = Number of years
n = Compounded interest frequency
I = Interest earned amount

Best fixed deposit investment tips
  • Carefully evaluate and compare factors such as maturity, interest, penalty for breaking FD before maturity.
  • Also, understand the broad macro-economic factors and expected trends in interest rates. If you expect the interest rates to go up soon, opt for a shorter tenure FD to keep your options open of investing when interest rates go up. If you expect the interest rates to go down soon, you can decide to opt for a longer tenure FD with a high-interest rate.
  • Before parking your surplus amount into a fixed deposit account, depositors should also check and compare the tenure wise interest rate offered. In some cases, banks offer a higher rate of interest on FD held for a shorter tenure than on the FD kept for a longer time period. Similarly, higher interest rates don't have to correspond with longer tenure. Banks may offer a higher interest rate on some select tenure to manage their internal liquidity position.
  • Lastly, carefully plan all your expenses and create a FD only for an amount that you believe you will not require for a minimum period. Suppose, if you have surplus money Rs. 100,000 but you have a home loan repayment of Rs. 50,000 scheduled after two months. In this case, you should deposit Rs. 50,000 in a short-term FD of less than 2 months and the remaining Rs. 50,000 in to a long tenure FD.
Income tax on Fixed Deposit interest

Interest on FD is taxed at marginal tax rate applicable to the depositor. Hence, for a person in topmost tax bracket, the post tax return on a FD that earns 9% interest may work out to just 6%.

  • One point that a lot of depositors are unaware of the fact that interest income on FD’s is taxed on accrual basis. To explain this further, let's take the example of a cumulative fixed deposit of Rs. 100,000 placed at 10% for 5 years on 1st April 2017. The maturity value of this FD will be Rs. 163,862 taking into account quarterly compounding. The first-year interest accrued on this FD comes to Rs. 10,381. However, the depositor will not receive any, still, the depositor must pay tax on the accrued interest in the year 2017-18 in the assessment year 2018-19.
  • In case the interest earned by you on fixed deposits with all branches of a bank in a year exceeds Rs. 40,000, your interest income will be subject to 10% tax deduction at source (TDS). Remember to quote your IT PAN when opening the term deposit, as otherwise the bank will need to deduct twice the tax at 20%. Also, you can claim credit for TDS only if your PAN is recorded with the bank.
Regular FD vs Tax Saving FD vs Flexi FD

Regular FD

These deposits are made for a fixed time period with the bank, and it allows you to earn a high rate of interest on your deposit amount, depending on the tenure of FD. The FD interest rate is as offered by the bank at the time of deposit.

Tax saving FD

This is a special type of deposit which allows the depositor to claim deduction on interest earned of FD under Section 80C of Income Tax Act. The deduction limit is Rs. 1,50,000. Key Features of Tax Savings FD are:

  • Money deposited in this FD has a lock-in-period of a minimum of 5 years
  • Premature withdrawal or partial withdrawal is not allowed
  • Loans against FDs are not available
  • Interest earned on tax savings FD are exempted under Section 80 C of Income Tax Act up to a maximum limit of Rs. 1.5 lakh

Some of the popular tax saving FDs along with their interest rates offered by banks are as follows:

Bank Tax Saving FD Minimum deposit Tax Saving
SBI SBI Tax Savings Scheme Rs. 1,000 6.00%
HDFC Bank HDFC Bank 5 Year Tax Saving Fixed Deposit Rs. 100 6.40%
Axis Bank Axis Bank Tax Saver Fixed Deposit Rs. 100 6.50%
Kotak Bank Kotak Bank Tax Saving Fixed Deposit Rs. 100 6.20%
ICICI Bank ICCI Bank Tax Saving Fixed Deposit Rs. 10,000 6.40%
Citibank Citibank Tax Saver Deposits Rs. 1,000 5.25%
Bank of Baroda Bank of Baroda Tax Savings Term Deposit N.A 6.25%
Corporation Bank Corporation Bank Tax Saver Plus Deposit Scheme Rs. 100 6.45%
PNB PNB Tax Saver Fixed Deposit Scheme Rs. 100 6.05%
RBL Bank RBL Bank Tax Savings Fixed Deposits N.A 7.45%
Central Bank of India Central Bank of India Tax Saving Deposit Rs. 100 6.20%
Syndicate Bank Syndicate Bank SyndTaxShield Deposit Rs. 100 6.30%
IDBI Bank IDBI Bank Suvidha Tax Saving Fixed Deposit N.A 6.30%

Flexi FD

A Flexi deposit allows the depositor to link its fixed deposit account with a savings bank account. Your deposited money moves in between the fixed deposit and savings account. It is also popularly known as Sweep in- Sweep out fixed deposit. This facility allows you to earn higher interest rates on surplus amount in your savings account. Key Features of Sweep-In facility account are:

  • A sweep-in facility facilitates automatic transfer of surplus funds from your savings deposit account into your fixed deposit account
  • This facility allows you to earn a higher rate of interest on your deposited money, which is generally higher than a regular savings account, while it varies from bank to bank. Still, in most of the cases, you earn a 1 year FD rate when your money is swept from Savings Account to FD Account. Currently, 1 year FD interest rates are 6.00% to 8.00%
  • With a sweep-in-facility, you may also interlink multiple deposits to your Savings Bank Account
  • You can withdraw the amount from your fixed deposit in case of any emergency without breaking complete FD or levying any penalty
  • Banks do not levy any additional fees on this facility unlike overdraft facility

Frequently Asked Questions on Term Deposit

What is the minimum amount required to start an FD?

You can deposit a minimum amount of Rs. 1,000 in FD account but there is no upper cap on deposit amount.

Which is highest interest rate on fixed deposit?

The highest interest rate on fixed deposits in the market is offered by DHFL at 9.25% for regular FD and 9.75% for senior citizens.

In how many years FD will double?

The tenure within which the sum invested in FD will double depends directly on these factors; the rate of interest, amount invested, and the tenure of the deposit.

Who are eligible to invest in FD schemes?

The following are eligible to invest in FD schemes- Resident Individuals, HUFs, NRIs, Firms, and Charitable Trusts, while others can apply for the scheme by submitting an offline application.

What are the documents required for opening FD?

The following documents are required for opening a Bank FD Account

  • Identity proof
  • Address proof
  • Signature proof
  • Age proof (for senior citizens)
What is the interest rate on a Bank FD for senior citizens?

Senior citizens get higher rates between 0.25 and 0.75 percent on their FD.

Is FD a good investment?

Choosing FD is a good decision if you are looking to earn a competitive rate of interest without taking any risk. It is one of the safest investment options available in the market.

What is the difference between RD or FD?

Recurring Deposit (RD) lets you deposit a certain amount each month in the account to earn interest on the invested sum for a specified tenure on a predetermined rate of interest. Whereas, Fixed Deposit (FD) is created by investing a lumpsum amount for a specified tenure on a predetermined rate of interest.

What is the minimum tenure for which I can open an account in FD?

You can open a fixed deposit account for minimum of 7 days in banks and for 1 year in NBFCs.

How much can be the maximum tenure for which I can open an account in FD?

The maximum tenure for FD in NBFCs is 5-7 years, whereas banks provide maximum tenure of 10 years for fixed deposit.

When do I become accountable for tax on FD?

As per Income Tax Act 1961, under section 194A, when the interest earned on FD in a financial year exceeds Rs. 40,000, TDS of 10% is applicable on the credited interest. A depositor may also furnish Form 15G/15H to avail exemption from paying tax on his interest income.

Does investment made into term deposits provide any benefits?

Yes, investing in term deposits provides many benefits, including a fixed rate return on your FD investment, flexibility to withdraw the FD at any time before its maturity. Besides, an individual can also avail loans up to the amount invested in the FD along with the overdraft facility from the bank against the FDs.

Can I redeem my fixed deposits before the original term?

Yes, an FD can be closed before its original term. If the FD is closed before completing the original term of the deposit, the interest will be paid as per the interest rate applicable on the date of deposit for the period it has remained with the bank. However, some banks may also levy a penalty prescribed by them on the date of deposit.

When can I renew my FD?

The person may renew his/her FD on maturity by submitting a duly filled FD Application Form, 15 days before the date of maturity, along with the old FD receipt with a revenue stamp of requisite value on it. However, your FD renewal will be subjected to the terms and conditions of the FD scheme as applicable to the maturity date of the old deposit.

Can I take a loan against fixed deposits?

Yes, many lenders provide the facility to take loans against fixed deposits. The bank generally provides loans on your FD up to the extent of 75-95%, depending upon the lender and loan tenure. Usually, loan against FDs is quick and cheap loans available to meet financial emergencies.

Can I opt for an auto-renewal facility while opening a FD?

Yes, you can opt for an auto-renewal facility at the time of opening the FD account prior to its maturity. The auto-renewal facility allows your FD to get renewed automatically for the same period as the original deposit. However, under the auto-renewal option, the time deposit receipt is with the bank’s custody, and Memorandum of Deposit (MOD) is issued in lieu of a fixed deposit receipt.

Why does the Fixed Deposit rate fluctuate?

The fixed deposit interest rate fluctuates due to changes in the prevailing macro-economic conditions. The various factors responsible for the change in fixed deposit interest rates include a higher rate of inflation, liquidity condition, and demand and supply conditions.

What is the maximum exemption that I can get under tax saver Fds?

Under tax saver FD, you are eligible for tax deduction under Section 80C of Income Tax for a maximum amount os Rs. 1.5 lakhs in a year. 

Do banks charge a penalty for early withdrawal of FD?

A fixed deposit is like a commitment where you have committed a certain sum of money with the bank for a specified tenure, and in return, the bank gives you interest at a specified rate. So, when you break the commitment in between, banks do charge a penalty on the surrender value, and you get less return on the invested sum.

Can I get monthly interest on a fixed deposit?

At the time of creating the fixed deposit account, you can choose for a monthly payment of interest, among other options such as quarterly, half-yearly, and annual interest payments.

What is tax saving FD?

The fixed deposit by investing in which you get tax deduction under Section 80C of the Income Tax is tax saving FD. The maximum deduction available is Rs. 1.5 lakhs, with 5 years of the lock-in period.

FD News - Feb 2020
*Terms and conditions apply. Credit at sole discretion of lender subject to credit appraisal, eligibility check, rates, charges and terms. Information displayed is indicative and from collected from public sources. Read More