Updated: May 24 2013
After I did the post on Indus Ind Bank offering 9.5% for 400 days, I received emails from readers Suresh Jain, and Vijay Dongre to tell me about a couple of other banks that are also offering good rates, so I thought I should do a small post to inform other readers about these banks that are offering high interest rates on fixed deposits.
I’ve also added to the information emailed to me by compiling a list of bank fixed deposits that are offering more than 9% right now.
Although I’m sure I would’ve missed some banks, I think this list constitutes some of the best fixed deposit rates that are currently being offered by Indian banks. If you know of any banks outside this list then please leave a comment, and I’ll update the post with your suggestions.
Some of you have asked about banks because they are safe, but there are plenty of other safe places to invest your money in India too, and you can opt for one of those instead of a bank. (Read: List of 10 Safe Investments in India)
| S.No. | Bank | Tenure | Interest Rate |
|---|---|---|---|
| 1 | Tamil Nadu Mercantile Bank | 20 month 20 days | 9.50% |
| 2 | Lakshmi Vilas Bank | 1 year | 9.50% |
| 3 | Karur Vysya Bank | 2 years to 3 years | 9.50% |
| 4 | City Union Bank | 2 – 5 years | 9.25% |
| 5 | Yes Bank | 15 months | 9.25% |
| 6 | Punjab and Sind Bank | 500 days | 9.25% |
| 7 | Central Bank of India | 555 days | 9.25% |
| 8 | Dena Bank | 750 days | 9.25% |
| 9 | Allahabad Bank | 1 year to less than 2 years | 9.15% |
| 10 | South Indian Bank | 1 – 3 years | 9.00% |
| 11 | Bank of India | 1 year to 8 years | 9.00% |
| 12 | Oriental Bank of Commerce | 1 years to 10 years | 9.00% |
| 13 | Canara Bank | 1 year to 2 years | 9.00% |
| 14 | State Bank of Patiala | Â 555 days | 9.00% |
| 15 | Indian Bank | 9 months to less than 3 years | 9.00% |
| 16 | Kotak Bank | 700 days | 9.00% |
| 17 | Andhra Bank | Â 1 year to 10 years | 9.00% |
| 18 | Corporation Bank | 1 year to 5 years | 9.00% |
| 19 | IDBI Bank | 500 days to 5 years | 9.00% |
| 20 | Indian Overseas Bank | 1Â – 5 years | 9.00% |
| 21 | ICICI Bank | 390 days to 2 years | 9.00% |
| 22 | Syndicate Bank | 1 year | 9.00% |
| 23 | Axis Bank | 15 months to less than 5 years | 8.75% |
| 24 | Dhanalaxmi Bank | 200 days | 8.75% |
| 25 | State Bank of Travancore | 1 year to 1000 days | 8.75% |
| 26 | Bank of Baroda | 1 year | 8.60% |
| 27 | J&K Bank | 1 year – 10 years | 8.50% |
| 28 | Vijaya Bank | 1 year to less than 3 years | % |
| 29 | Karnataka Bank | 1 year to 3 years | % |
| 30 | Federal Bank | 1 – 3 years | % |
As you can see these are some great rates, and the good news is that the tax saving fixed deposits have also got some great rates these days. If you haven’t done your tax saving investments yet then you can take advantage of those rates.
Fixed deposits aren’t the only thing that help you save tax – there are plenty of other instruments that help save tax and you can visit this page to understand the nuances of Section 80C tax saving investments in an easy to understand graphic.
Update: There was an error in the post where I said HDFC is offering 9.50%, but a couple of readers emailed me to let me know that the higher rate was for senior citizens only. I have corrected that, and apologize for the error. Thank you to Anil Kumar Kapila, and Rakesh Jain for their emails. Also, the list of senior citizen’s bank interest deposits didn’t include quite a few names in the above table which I have done now. Update 2: Added ICICI Bank’s 990 days interest rate for senior citizens. Update 3: Added Indian Bank on the comment of P.T Palani Update 4: Removed the list of senior citizens interest rates from this post because I’m finding it hard to keep the list current.
Is the interest rate calculated per year or is it fixed for the duration?
What I mean here is – suppose Bank A proposed a FD scheme like this: 10% for 555 days. So do we get 10% of deposited amount at the end of the tenure or we get 10% compound interest calculated on yearly basis?
I guess it should be latter, but just want to confirm it.
Thanks!
You’re right Rahul – the rates that banks advertise are annual rates.
Dear Sir,
How banks calculate interest rates on FDs. As ICICI Bank offers 9.25% for 790 days and 8.50% for 791 days to 989 days. Normally, for higer period of deposits, interest rates should be on higher side.
That is usually true, but not always. In the last few months every bank has changed their rates to give a higher rate on the lower duration.
For NRI’s below are the interest rates… iam confused on why 590 days (which is less than two years) has more rate compared to other days show in the chart below. Any ideas ?
590 days
9.25
591 days to less than 2 years
8.25
2 years to 789 days
8.50
This has happened in the past 4 or 5 months where you see short term rates higher than longer rates.
Is there any Reason ??
Do we need to open an account in the bank in order to open a fixed deposit?
LAXMI VILAS BANK IS ALSO OFFERING 10.10% FOR 180 DAYS TO 1 YEAR TENURE FD
CAN WE EXPECT RISE IN FD INTEREST RATE IN BANKS IN THE NEW FINANCIAL YEAR. WAITING FOR YOUR REPLY
Rates are expected to continue to rise with RBI saying they want to fight inflation. By how much and when I do not know.
what suppose If i can split my deposit into 10 different branches of KVB , will the tax still be deducted as the FD will be just 1 lac per branch ,
Sorry Radha – I don’t know what will happen in that case.
I am planning to invest 10 lacs in FD in karur vysya bank for 590 days, I am a tax payer at 30% tax slab ,
what will be the IT that will be deducted if I make the above deposit and say if the interest accrued p.a = 105000,
TDS will be deducted at 10% of interest.
FYI – HDFC revised rates to 9.25% (9.75% for sr. citizens) for 2 yrs 16 days. Other banks have done this also to boost up books before year end. Can you please update the table so people can take advantage as always? Thanks.
Thanks MGM – I appreciate the comment – I had updated the post a little while ago, but it got dated again – I will update it this weekend.
You will get prevailing interest rate of 1 year minus 1percent is deducted as penalty. Also,please check with your bank.
Dear Sir,
I have FD for 5 years at interest rate 8.25
The period completed is one year (12 months)
I want to break the FD prematurely and make fresh FD at interest rate 9.75 (for senior citizens)
Pls tell me what will be the deductions for breaking the FD prematurely.
Best Regards
Rajinder saini
Which bank is this? Please check with them if they will deduct a penalty or not. Some banks don’t charge a penalty if you deposit the money with them again. Also, you will get the interest rate as if you created the FD for the time frame that you kept it. So if you break it after 12 months – they will see what the interest rate would have been if you initially made it for 12 months and pay you an interest for that.
I have heard that according to a study conducted by Care Ratings, the banks in India might have to raise the fixed deposit rates by around 100 basis percent or 1 percent in the next one year.So can anyone provide me with latest interest rates.
State Bank of Bikaner and Jaipur is offering 10.25% on fixed deposits to Senior Citizens and 9.75% in others for various period option ranging between 2-5+ years. Can we expect further rise in interest rates on fixed deposit in near future.
Let’s see the monetary policy is going to be declared on 17th March, and most people are talking about some increases, so I won’t be surprised if there is a rate hike in a month or so.
pls. update your records as fixed deposit rates have been revised from 25th Februaty 2011.
I’ll update the post this coming weekend.
please send me detail which bank give high interest on FD. for non seniar citizen
Sir, I have made a fixed deposit at a rate of 8.75% as a senior citizen in Yes Bank about six months back. I want to break this FD and invest in a FD with higher rate of interest. I want to know whether there is possibility of further interest rise. Should I wait for some time for further revision of interest. Or rates prevailing today are at peak rates. Please advise me through my email ID. [email protected].
Krishan Kumar.
To be honest I don’t have any insight on whether to expect a further rate hike or not. Please wait till the budget is out, as that will give a sense of the government’s borrowing programs, which in turn affect interest rates.
INDIAN BANK REVISED INTEREST RATES UPWARD WEF 18TH FEB 2011, FOR ALL DEPOSITS RANGING FROM 9.1 %FOR 111 DAYS TO 9.5% FOR 555 DAYS. ADDITIONAL 0.75% SHALL BE PAYABLE FOR SENOR CITIZENS.
I appreciate the fact that you’re posting all these updates here – thanks a lot. I will be updating this post during the weekend.
Hi
Thanks for sending the max rate of interest paid by Banks to Sr Citizens I will also like to add That State Bank of Patiala has also revised up to 10% interest rates for Sr Citizens on fix deposits.
Another thing IDBI bank do not imposed any penalty on premature FDs or partial premature FDs. likewise some other banks may also be giving this facility.
Thanks.
V K Aggarwal
Thanks for that info – I’ll update this post during the weekend to reflect the SBP interest rate.
Indian Bank Deposite Rate for 555 days is 9.5% and 10.25 for Sr. Citizen. Plz correct.
karur vysya bank has
10.25% for general
10.50% for senior citizens
both for 555 days
Thanks for that info Ankeet.
please give your comments on 10-15 years SBI BOND.
Here is the detailed post about it:
http://www.onemint.com/2011/02/15/sbi-retail-bonds-at-9-95-for-15-years/