FD Rate: If you are a senior citizen and want to invest in FD, this may be the right time for you. Some banks are still offering interest rates up to 9.1%, but due to RBI’s repo rate cut, interest rates may change in the future.
Senior Citizens FD Rate: This is a great opportunity for senior investors, as some banks are still offering up to 9.1 per cent interest on 5-year FDs. However, some banks have recently started cutting interest rates, as the Reserve Bank of India (RBI) reduced the repo rate by 25 basis points (BPS) on February 7, 2025. Let us know which banks are still offering these attractive interest rates.
Which banks are offering the highest interest?
9.1% interest rate
Suryoday Small Finance Bank is offering 9.1% interest to senior citizens on 5-year FDs. This is currently one of the highest interest rates offered by any bank.
8.65% interest rate
Unity Small Finance Bank is offering 8.65% interest rate to senior citizens on its 5-year term FDs.
8.5% interest rate
Northeast Small Finance Bank is offering 8.5% interest rate to senior investors on 5-year FDs.
8.35% interest rate
Utkarsh Small Finance Bank is offering 8.35% interest to senior citizens on 5-year fixed deposits.
8.2% interest rate
Jana Small Finance Bank is offering 8.2% interest to senior investors on 5-year FDs.
Tax saving benefit on 5-year FD
Under the old tax regime, investing in 5-year FDs gives senior citizens a tax exemption of up to Rs 1.5 lakh under section 80C. However, investors adopting the new tax regime will not get this exemption.
Apart from this, senior citizens can avail exemption on interest income of up to Rs 50,000 every financial year under section 80TTB. However, tax will be payable on the maturity amount of the FD as per the tax slab.
Caution is necessary before investing in small finance banks
Deposits in small finance banks are insured up to Rs 5 lakh by the Deposit Insurance Credit Guarantee Corporation (DICGC). However, experts advise that investors should decide the limit of their investment keeping in mind the risks. The business model of these banks is different from traditional banks, due to which the level of risk may also vary.
