These seven banks offer highest interest rates on their 3-year fixed deposits. Typically longer the tenure, higher the interest rates on term deposits
When you are planning to open a fixed deposit, it is recommended to compare the interest rates offered by different banks so that you can choose the one which offers the highest one.
Typically, a long tenure fixed deposit offers a higher interest rate. We list out the interest rates offered on 3-year term deposits by top 7 banks – both private and public sector. Meanwhile, it is important to note that a marginal difference of, say, 50 basis points in interest rates can lead to higher savings over a long period of time.
For instance, if one bank offers 50 basis points higher interest on a fixed deposit of ₹10 lakh, the higher income on account of 50 basis points can lead to an extra income of ₹15,000 in three years.
Here we list out the highest interest rates offered by top 7 banks.
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Highest interest rates by top 7 banks
HDFC Bank: This private bank offers 7 percent interest on its 3-year deposits to regular citizens and 7.5 percent to senior citizens.
ICICI Bank: This private bank offers 7 percent interest on its 3-year fixed deposits and 7.5 percent to senior citizens.
Kotak Mahindra Bank: This bank offers 7 percent interest on its 3-year term deposits and 7.6 percent to senior citizens.
Federal Bank: This private sector bank offers 7.1 percent interest on three year deposits to regular citizens and 7.6 percent to senior citizens
State Bank of India (SBI): The largest bank in India offers 6.75 percent to general citizens and 7.25 percent to senior citizens.
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| Bank | Interest (%) | Senior Citizens (%) |
|---|---|---|
| HDFC Bank | 7 | 7.5 |
| ICICI Bank | 7 | 7.5 |
| Kotak Mahindra Bank | 7 | 7.6 |
| Federal Bank | 7.1 | 7.6 |
| SBI | 6.75 | 7.25 |
| Bank of Baroda | 7.15 | 7.65 |
| Union Bank of India | 6.7 | 7.2 |
Bank of Baroda: This public sector bank offers 7.15 percent to regular citizens and 7.65 percent to senior citizens.
Union Bank of India: This bank offers 6.7 percent to regular citizens and 7.2 percent to senior citizens.
Meanwhile, it is advisable for investors not to lock too much of money in term deposits are taxable. Therefore, taxpayers who fall in the higher tax bracket tend to lose almost one-third of their interest income to tax.
