Fixed Deposits: 24 Banks Offering Highest Interest Rates On 6 Month To 1 Year FDs, Check List

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Short-term FDs are a solid asset class that can help investors diversify their portfolios and minimise risk.

A short-term fixed deposit is a financial tool offered by banks and non-bank financial institutions. These FDs provide a variety of advantages while also encouraging customers to deposit money and receive high short-term FD rates. They typically have a maturity period of less than a year and give a unique opportunity for investors to park their cash while earning returns and maintaining liquidity.

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Short-Term FDs: Check The Benefits

– Short-term FDs have several advantages, including flexibility and liquidity. Unlike long-term FDs, which lock in cash for several years, short-term FDs allow investors to withdraw funds relatively rapidly. This liquidity feature makes them appropriate for those who may require access to their funds soon for a variety of reasons, including planned expenses, emergencies, or investment opportunities.

– In addition to liquidity, short-term FDs provide a predictable and certain rate of return. These FD’s interest rates are fixed at the moment of investment, giving investors a clear picture of their returns. This predictability is useful for investors looking for consistency in their investment portfolio, particularly during uncertain economic times or unpredictable market situations.

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– Short-term fixed deposits also have the advantage of being simple and easy to invest in. Opening a short-term FD account is a simple process that requires little documentation and is frequently available through online banking services. This convenience makes it appealing to both experienced investors and those new to financial investments.

– Tax efficiency is another area where short-term FDs can help, particularly for investors in lower tax bands. Interest on short-term FDs is normally added to the investor’s income and taxed accordingly. To reduce their tax liability, investors can look into tax-saving FDs or take advantage of their annual tax exemptions and deductions.

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Below are 24 banks that offer the highest interest rates on 6 months to 1-year FDs:

1. Bank of Baroda: 5.60% to 7.10%
2. Bank of India: 5.5% to 5.75%
3. Bank of Maharashtra: 5.10% to 6%
4. Canara Bank: 6.15% to 6.25%
5. Central Bank of India: 6.0% to 6.25%
6. Indian Bank: 3.85% to 7.05%
7. Indian Overseas Bank: 5.75%
8. Punjab and Sind Bank: 5.25% to 7.10%
9. Punjab National Bank: 6% to 7.05%
10. State Bank of India: 5.75% to 6%
11. UCO Bank: 5% to 5.50%
12. Union Bank of India: 4.90% to 5.75%
13. Axis Bank Limited: 5.75% to 6%
14. Bandhan Bank Limited: 4.50%
15. City Union Bank Limited: 6% to 6.5%
16. Federal Bank Limited: 5% to 6%
17. HDFC Bank Limited: 4.5% to 6%
18. ICICI Bank Limited: 4.75% to 6%
19. IDBI Bank Limited: 5.25% to 7.05%
20. Induslnd Bank Limited: 5% to 6.50%
21. IDFC First Bank Limited: 4.5% to 5.75%
22. Karnataka Bank Limited: 6.0% to 6.5%
23. Kotak Mahindra Bank Limited: 6% to 7%
24. Yes Bank Limited: 5% to 6.35%.

DISCLAIMER: The views and investment tips by experts in this News18.com report are their own and not those of the website or its management. Readers are advised to check with certified experts before making any investment decisions.