Fixed deposits have regained popularity as uncertainty looms over the markets, prompting many investors to seek the stability of assured returns. With certain banks offering rates as high as 7.75%, fixed deposits are once again becoming appealing to risk-averse individuals.
Unlike savings accounts with fluctuating and lower interest rates, fixed deposits allow you to secure your funds for a specific period and earn a fixed return. Typically, the longer you invest, the higher the interest rate, although excessively long tenures may not always yield the best returns.
State Bank of India (SBI), the largest public sector bank in India, is currently offering its most attractive fixed deposit rates in the two to three-year tenure. Regular customers can expect returns of approximately 6.45%, while senior citizens receive a slightly higher rate of 6.95%.
For longer durations, senior citizens have a distinct advantage. Deposits spanning from five to ten years offer them returns of about 7.05%, compared to 6.05% for regular investors.
Analyzing the rate structure in general, interest rates start lower for short-term deposits, gradually increasing as the tenure lengthens. The rates peak in the mid-term range of one to three years before slightly decreasing for longer periods.
HDFC Bank provides a range of fixed deposit rates, with the most lucrative returns observed in mid-term tenures. For very short-term deposits, such as seven to 29 days, regular customers earn around 2.75%, while senior citizens receive 3.25%. As the tenure extends to one to three months, rates elevate to 3.25% and 3.75%, and further increase to approximately 4.25% and 4.75% for deposits up to six months.
In the duration between six months and one year, returns improve to about 5.5% to 5.75% for regular customers and 6% to 6.25% for senior citizens. The bank offers approximately 6.25% for regular investors and 6.75% for seniors in the one to one-and-a-half-year range, with rates gradually escalating as the tenure progresses.
ICICI Bank, a prominent private sector bank in India, is presenting competitive fixed deposit rates across various tenures. For short-term deposits ranging from seven to 45 days, regular customers earn around 2.75%, while senior citizens receive 3.25%. As the tenure increases to one to three months, rates rise to 4% for regular investors and 4.5% for senior citizens, and further to 4.5% and 5%, respectively, for deposits up to around six months.
For deposits between six months and one year, the bank offers about 5.5% for regular customers and 6% for senior citizens. In the one to one-and-a-half-year range, returns improve to 6.25% and 6.75%, further increasing slightly to 6.3% and 6.8% for deposits up to two years.
The rates continue to climb in the two to three-year segment, where regular investors can earn around 6.45% and senior citizens about 6.95%. The highest returns are attainable in the three to five-year range, with regular customers receiving 6.5% and senior citizens up to 7.1%. This also applies to the bank’s five-year tax saver fixed deposit.
Yes Bank is currently offering competitive fixed deposit rates, particularly in the mid-term segment, among major banks. For short-term deposits, returns start at approximately 3.25% for regular customers and 3.75% for senior citizens for tenures between seven and 14 days. As the duration extends to one to three months, rates rise to roughly 3.5% to 4.5% for regular investors and 4% to 5% for senior citizens.
For deposits between three and six months, the bank offers around 4.75% for regular customers and 5.25% for senior citizens. The rates then increase sharply for tenures between six months and one year, ranging from about 6% to 6.5% for regular investors and 6.5% to 7% for seniors. Approaching the one-year mark, returns further enhance to about 6.65% for regular customers and 7.15% for senior citizens.
In the one to two-year range, interest rates continue to rise, with regular investors earning up to 7% and senior citizens up to 7.5%. The highest returns are observed in the three to five-year tenure, where senior citizens can earn up to 7.75%, while regular customers receive around 7%.
Beyond five years, rates ease slightly, with regular investors earning approximately 6.75% and senior citizens about 7.5% for long-term deposits of up to ten years.
Kotak