Senior citizens are usually offered an additional interest of 0.50%-0.75% p.a. for the regular depositors for tenures ranging from 7 days to 10 years. FD interest rates of scheduled banks range from 2.50% p.a. However, Private Sector Banks like Bandhan Bank, DCB Bank, Tamilnad Mercantile Bank, RBL Bank, IDFC First Bank, IndusInd Bank, Yes Bank, SBM Bank, CSB Bank and Federal Bank offer higher FD slab rates than the fixed deposit rates offered by other Private Sector Banks. Following them are PSU Banks and large Private Sector Banks. Small Finance Banks and NBFCs offer the highest FD interest rates.
These features also make fixed deposits an ideal instrument for realizing short-term financial goals and for parking emergency and post-retirement corpuses.
It offers income certainty and capital protection, making it a popular investment choice, especially among new and conservative investors. Fixed deposit (FD), also referred as ‘time deposit’ or ‘term deposit’, is an investment option that allows depositors to park their idle money for a fixed period and earn fixed interest on it at regular intervals during the chosen tenure or at maturity.
