If you are a senior citizen looking to earn a steady income and high returns on your investments without taking market risk, fixed deposits (FDs) are one of the most popular options. Most banks typically offer an additional 0.25% to 0.50% above regular interest rates on their senior citizen FDs.
Many senior citizens prefer investing in FDs since fixed deposits provide them with a fixed income, premature withdrawal facility with a minimal penalty, loan against FD option and sweep-in facility by linking their FD to savings account.
Highest
FD interest rates for senior citizens: PSU vs private vs small finance banks
Here’s a look at the highest FD interest rates available for senior citizens across public sector undertaking (PSU), private and small finance banks (SFBs).
Highest FD interest rate for senior citizens (small finance banks)
| Bank Name | Highest Interest Rate (%) | Tenure |
| ESAF Small Finance Bank | 8.5 | 501 days |
| Shivalik Small Finance Bank | 8.3 | 21 months 1 day to 22 months |
| Suryoday Small Finance Bank | 8.25 | 30 months |
| Equitas Small Finance Bank | 8 | 888 days |
| Jana Small Finance Bank | 8 | Above 1 year to 3 years |
| Utkarsh Small Finance Bank | 8 | 2 years to 3 years |
| Ujjivan Small Finance Bank | 7.95 | 2 years |
| AU Small Finance Bank | 7.75 | 30 months 1 day to 36 months |
| slice Small Finance Bank | 7.75 | 18 months 1 day to 18 months 2 days |
Highest FD interest rates for senior citizens (private banks)
Bank Name
| Interest Rate (%) | Tenure |
| SBM Bank India | 8.35 | 391 days to 15 months |
| Bandhan Bank | 7.75 | 2 years to less than 5 years |
| Jammu & Kashmir Bank | 7.75 | 888 days |
| YES Bank | 7.75 | 3 years to less than 5 years |
| RBL Bank | 7.7 | 18 months to 3 years |
| Tamilnad Mercantile Bank | 7.7 | 567 days (TMB567) |
| DCB Bank | 7.65 | 24 months to less than 25 months; 34 months to less than 35 months; 60 months to 61 months |
| CSB Bank | 7.5 | 18 months |
| IDFC FIRST Bank | 7.5 | 500 days to 3 years |
| IndusInd Bank | 7.5 | 1 year 6 months to less than 1 year 7 months |
| Kotak Mahindra Bank | 7.3 | 2 years to less than 3 years |
| South Indian Bank | 7.3 | 2 years |
| City Union Bank | 7.25 | 400 days |
| Federal Bank | 7.25 | 36 months |
| Axis Bank | 7.2 | 5 years to 10 years |
| Karnataka Bank | 7.15 | 555 days |
| DBS Bank | 7.1 | 376 days to 600 days |
| ICICI Bank | 7.1 | 3 years 1 day to 5 years |
| HDFC Bank | 7 | 3 years 1 day to less than 4 years 7 months |
| IDBI Bank | 7 | Above 2 years to less than 3 years |
Highest FD interest rates for senior citizens (PSU banks)
| Bank Name | Interest Rate (%) | Tenure |
| Punjab & Sind Bank | 7.25 | 666 days |
| Bank of Maharashtra | 7.15 | 400 days |
| Bank of India | 7.1 | 450 days - Star Swarnim |
| Canara Bank | 7.1 | 555 days |
| Indian Bank | 7.1 | 444 days |
| Indian Overseas Bank | 7.1 | 444 days |
| Punjab National Bank | 7.1 | 444 days |
| Union Bank of India | 7.1 | 444 days |
| State Bank of India | 7.05 | 5 years to 10 years |
| Bank of Baroda | 7 | Above 5 years and upto 10 years |
Is TDS deducted on FD for senior citizens?
According to the ICICI Bank website, “Yes, TDS is deducted on fixed deposit (FD) interest for senior citizens, but with a higher exemption limit. For a financial year, TDS is not deducted if the total annual interest income from a bank does not exceed Rs 1,00,000. If interest exceeds this amount, TDS is deducted at 10% (or 20% if PAN is not provided)”.
