If you are looking to earn higher-than-average returns from FDs, here is a list of the top 10 banks that are currently offering the highest interest rates on fixed deposits in the country.
Fixed deposits or term deposits are extremely popular in our country because of the assured returns they provide. They’re also extremely easy to invest in, are available in multiple terms and involve high liquidity. However, 10% TDS is deducted by a bank if the interest income across all the FDs with it exceeds Rs 40,000 in a year. This threshold is Rs 50,000 for senior citizens.
That said, a 20% TDS is applicable if you don’t submit your PAN card details to the bank. But no TDS is applicable if the total annual income of the investor is less than the minimum taxable amount of Rs 2.5 lakh, which can be waived by submitting Form 15H (if you’re a senior citizen) or 15G (if you’re not a senior citizen) to the bank, according to BankBazaar.
However, with the Reserve Bank of India leaving the repo rate unchanged at 4% for almost a year now to counter the economic fallout of the Covid-19 pandemic, most of the banks have lowered their fixed deposit interest rates. This has been a cause of concern for countless risk-averse investors like senior citizens who heavily rely on their FD returns not just to accomplish their financial goals but also to fund their day-to-day expenses.
In fact, most of the banks are currently offering interest rates in the range of 4.25%-5.75% p.a. on normal FDs amounting to less than Rs 1 crore. Senior citizen depositors get preferential rates by up to 50 basis points over and above the normal FD rates. But there are a few banks that are still offering higher interest rates on their FDs up to 7.51% p.a.
Investors can consider investing a portion of their funds in them after a thorough risk assessment, and, if doing so is in line with their returns expectations, risk tolerance and liquidity requirements, as per BankBazaar.
So, if you’re looking to earn higher-than-average returns from FDs, here is a list of the top 10 banks that are currently offering the highest interest rates in the country. Do note, all the rates mentioned in the table below are for normal FDs (for non-senior citizen depositors) amounting to less than Rs 1 crore.
10 Banks Currently Offering The Highest FD Interest Rates
Disclaimer: Data were taken from respective banks’ websites on April 2, 2021. All interest rates are for normal fixed deposits amounting to less than Rs 1 crore. Compiled by BankBazaar.com, an online marketplace for loans, credit cards and more.
