New Delhi: People are adopting various methods to earn substantial income without facing significant hassles. The government also runs several schemes where investments remain secure while offering impressive returns. Some banks offer higher interest rates to senior citizens compared to regular customers. We are going to tell you about Fixed Deposits (FDs).
Currently, Small Finance Banks are offering the highest interest rates on 5-year FDs. FDs offer the dual benefit of earning interest while keeping the investment secure. It is also important to consider conditions such as premature withdrawal rules and minimum deposit amounts to clear up any confusion. Interest rates are a crucial factor for those investing in fixed deposits.
Where are the higher interest rates available?
Among the country’s Small Finance Banks, senior citizens are receiving the highest interest rates. Suryoday Small Finance Bank offers the highest rate of 8.50% on 5-year FDs. This is followed by Jana Small Finance Bank at 8% and Ujjivan Small Finance Bank at 7.70%. Equitas Small Finance Bank and Utkarsh Small Finance Bank offer an interest rate of 7.50%. Meanwhile, AU Small Finance Bank and Slic Small Finance Bank are offering 7.25% interest.
What interest rates are private banks offering?
Regarding private sector banks, DCB Bank offers 8% interest to senior citizens on 5-year FDs. SBM Bank India and Yes Bank offer a rate of 7.50%. Axis Bank and Jammu & Kashmir Bank offer 7.25% interest. RBL Bank and Tamilnad Mercantile Bank are offering an interest rate of 7.20%, while IndusInd Bank offers 7.15% and ICICI Bank offers 7.10%.
Find out the interest rates offered by public sector banks.
Among public sector banks, SBI is offering a competitive rate of 7.05%. Bank of Baroda is offering 6.90% interest to customers. Additionally, Punjab National Bank is providing 6.85% interest. Bank of India and Canara Bank are offering 6.75%, while Indian Overseas Bank is offering 6.60%. Central Bank of India, Indian Bank, and Union Bank of India are offering 6.50%. Furthermore, Punjab & Sind Bank offers 6.45%, and Bank of Maharashtra offers 5.50%.
TDS deduction details
For senior citizens, TDS may apply if the interest earned on a Fixed Deposit (FD) with a single bank exceeds ₹1 lakh in a financial year. TDS is not an additional tax burden; if your actual tax liability is lower, you can claim a refund by availing of the credit for this deduction while filing your Income Tax Return (ITR).
