FD Interest Rates in India 2026

What Are Fixed Deposit Interest Rates?

When you book a fixed deposit for a certain period, the bank or the NBFC guarantees a rate based on the applicable slab. You earn interest during payout depending on the compounding frequency and the payout option. Most Indian banks use quarterly compounding. But the returns also depend on whether your FD is cumulative or non-cumulative. In a cumulative FD, interest compounds within the deposit and is paid at maturity. If you choose a non-cumulative FD interest is paid periodically, reducing the power of compounding.

Fixed deposits have remained popular among investors who want to park a lump-sum amount and earn guaranteed returns. They are especially popular among risk-averse investors and senior citizens. In addition to the security of banks, DICGC's insurance provides an extra layer of protection. Along with banks, non-banking financial companies, and post offices also offer time deposit options.

How FD interest rates are calculated

Banks usually show you interest rates per annum at the time of booking an FD. However, most banks in India calculate interest quarterly. To do this, banks divide the annual rate into four quarters and compute accordingly. That means compounding-based growth of your deposit happens quarterly, not annually. All in all, your ROI depends on four main factors: the deposit amount, applicable interest rate, tenure, and payout frequency.

Simple Interest and Compound Interest

Based on your chosen tenure, the bank either uses a simple or compound interest calculation. Usually, simple interest is used for short-term deposits. You earn interest only on your initial deposit. The interest amount stays the same every month. It does not grow on previous interest.

Compound interest calculation, on the other hand, relies on interest-on-interest computing. Your interest is added to your deposit regularly. Then, you earn interest on that accumulated amount. Most FDs use quarterly compounding for better growth.

Key Factors Affecting FD Interest Rates

While economic factors like the RBI’s repo rate directly influence FD rates, other factors like deposit amount and age affect rates differently for every investor. Here are the most important factors impacting fixed deposit interest rates.

• Repo Rate: RBI’s repo rate is the most important driver of FD rates. When the RBI raises repo rates, banks, too, increase FD rates and vice versa.
• Economic Conditions: In a global, digital-powered economy, factors like inflation, liquidity in the banking industry, and GDP growth impact FD rates.
• Deposit Tenure: Every bank offers a defined rate for a specific tenure. And your chosen time period plays a notable role in how much return you would get. Longer tenures usually provide higher returns.
• Deposit Amount: Larger deposits often get higher rates and smaller savings. These are commonly known as "bulk deposits" and have special interest rates.
• Depositor’s Age: Most banks offer higher rates to senior and super-senior citizens. This is a common benefit for those over sixty. Depositors below 60 get general public rates.
• Type of Bank: Small finance or newer banks often offer higher interest rates to attract customers. Among larger banks, private banks usually offer higher rates than public sector banks.

FD Interest Rates Today: Highest Returns

Here’s a snapshot of the highest FD rates available across private banks, public banks, and NBFCs.

Note: FD interest rates w.e.f. June 2026. Rates are subject to change. Rates shown are for retail deposits below Rs. 3 crore.

Top 10 Banks Offering the Highest FD Rates in India

Below are the fixed deposit rates offered by leading public and private sector banks in India.

Note: FD interest rates as of June 2026. This table is not a ranking of banks and is for informational purposes only.

FD Rates of Top Public Sector Banks in India

Here is a list of the best fixed deposit interest rates in India offered by Public Sector Banks for deposits of up to ₹3 crores:

Note: Public sector banks here are listed based on their size. This order does not indicate performance, ranking, or recommendation. FD interest rates as of June 2026.

FD Rates of Top Private Sector Banks

Here is a list of the best fixed deposit interest rates in India offered by Private Sector Banks for deposits of up to ₹3 crores:

Note: FD interest rates w.e.f. June 2026. Rates are subject to change.

FD Rates Offered by SFBs, Foreign Banks, & NBFCs

Small finance banks (SFBs) and non-banking financial companies (NBFCs) offer higher rates than larger banks. Below are the available highest FD return rates.

Note: FD interest rates w.e.f. June 2026. Rates are subject to change. This table is not a ranking of NBFCs and small finance banks and is for informational purposes only.

Rates Comparison by Category: Short-Term, Medium-Term, & Long-Term FDs

FD interest rates as of June 2026.

FD Rates for Senior Citizens

Senior citizens prefer fixed deposits more than any other investor group due to a multitude of reasons. Firstly, senior-citizen investors like to put their money in products that are safe and come with guaranteed returns. This is important since many retirees, especially the ones with larger deposits, use FDs as their main source of regular income. Additionally, senior citizens also get higher interest rates than customers below 60. Some banks offer additional preferential rates to super-senior citizens (individuals aged 80 and above). Plus, FDs are easy-to-understand investment products, and you can invest even if you are not savvy about the latest stock market trends. A combination of these factors makes fixed deposits a popular choice among senior citizens. Currently, the highest senior citizen FD rate is up to 7.75% p.a. from Bandhan Bank and Bank of India, and up to 9.35% p.a. from Muthoot Capital.

Short-Term FD Rates (7 days to 1 year)

FD interest rates as of June 2026.

Medium-Term FD Rates (1 to 3 years)

FD interest rates as of June 2026.

Long-Term FD Rates (3 to 10 years)

FD interest rates as of June 2026.

Fixed Deposit Calculator

An FD calculator enables you to make investment decisions based on your financial goals. By using our FD calculator, you can decide on how much you need to invest and for how long. You may also like to use this calculator to get an estimate of your returns when you have already decided on how much you want to invest. Just select your investment amount, the expected interest rate, and the tenure. The calculator will give you a breakdown comprising the interest earned and the total maturity amount.

Illustration - Maturity Amount Calculation

Here’s an example of a depositor who puts ₹5,00,000 in an FD for 5 years. The rate of interest the depositor gets is 6.5%.

• Investment amount: ₹5,00,000
• Deposit tenure: 5 years
• Interest rate: 6.5% p.a.
• Compounding: Annually (cumulative)

Here’s how the investment will grow after 5 years:

• Total investment: ₹5,00,000
• Total interest earned: ₹1,85,530
• Maturity value after 5 years: ₹6,85,530

Types of Fixed Deposits of India

Fixed deposits are a popular savings product across various demographics and investor profiles in India. Despite being a traditional savings product, FDs have remained popular in today’s digital-first financial market thanks to their diversity and evolution over the years. FDs cater to the unique needs of risk-averse investors through a wide variety of options. Here are the main FD types available in India in 2026.

Cumulative FDs

In cumulative fixed deposits, your earned interest compounds, and the total interest is paid at maturity. The compounded interest is reinvested. This type of deposit works best when you can maintain the investment duration and withdraw after maturity. Suitable for goal-based investments like kids’ education or maintaining an emergency fund.

Non-cumulative FDs

Your interest income from non-cumulative FDs is paid at a specific frequency. It could be monthly, quarterly, or annually, based on the type of specific FD product you choose. Here, the interest earned doesn’t compound. Non-cumulative FDs are common across major banks in India.

Tax-Saver FDs

These deposits are designed to help depositors save on taxes. You get deductions under Section 80C, with a maximum annual cap of ₹1,50,000. Tax-savings FDs have a 5-year lock-in period and usually have higher interest rates than other FD types.

NRE/NRO FDs

Most banks in India have FD products specifically designed for non-resident Indians (NRIs). These products are usually available through two types of bank accounts: Non-resident ordinary (NRO) and Non-resident external (NRE) accounts. NRO rates are usually similar to domestic FD rates. But most banks offer separate rate slabs for NRE FDs.

Flexi Deposits

As the name suggests, these FDs are designed to offer flexibility. With features like sweep-in and sweep-out, flexi deposits automate savings and investment. You can set up these features to automatically transfer money to your FD or withdraw whenever you need liquidity options.

Who Should Invest in FDs?

Due to their diversity and guaranteed returns, FDs suit most investor types. However, fixed deposits are most suitable for risk-averse investors who don't want to deal with the complexity of financial markets.

• Risk-Averse Investors: FDs are ideal if you dislike market risks. Your principal amount stays safe regardless of market swings.
• Retirement Planners: People looking for safe retirement savings products could benefit from the safety of FDs. You get a steady and guaranteed income stream and invest for the long term to get higher rates.
• Short-Term Financial Planners: If you’re saving for a wedding, a vacation, or a major purchase, FDs provide a certain amount on a fixed date.
• Portfolio Diversifiers: You can also use FDs to balance your riskier investments, like mutual funds. Fixed deposits provide stability to your overall investments.
• Emergency Fund Builders: FDs are a secure place to park your "rainy day" fund. The money is easily accessible when you need it.
• Traditional Savings Customers: If you’re not savvy about investing in stocks and other complex financial instruments, FDs could give you assured returns while keeping things simple for you. All you need to understand is the applicable interest rate and the tenure.

How FDs Support Your Financial Goals

Fixed deposits can work as useful tools for achieving your financial goals, especially if you are planning long-term investments. If you have a capital that you want to invest and achieve growth, FDs can help you achieve a guaranteed, steady growth. It could be putting your money in a product to generate a fund for future needs, like your child’s education, buying a house, or even adding to your retirement corpus.

How FDs Suit Different Risk Profiles of Investors

Fixed Deposits can become a safe addition to almost any investment plan. However, their value changes based on your comfort with risk.

• Risk-Averse Investors: Fixed deposits are perfect for investors who don’t want to deal with any market-related risks. Investors of this profile value safety above all else. FDs ensure that their money is protected from market crashes and they get a fixed and steady return.
• Moderate-Risk Investors: This category of investors can use FDs to balance their portfolio. Fixed deposits could work perfectly to provide a stable core for your wealth. Guaranteed returns offset the risks of their other investments, creating a helpful safety net.
• High-Risk Investors: FDs are not for you if you are a high-risk investor and like to dwell on the highs or markets while actively managing your portfolio. This investor category seeks much higher rewards over time. So, FDs are unlikely to meet your expectations.

Features and Benefits of FDs

Whether it’s the safety of guaranteed returns, flexibility of auto-sweep, or tax benefits, FDs can benefit different investors in different ways. Here's an overview of the key benefits of investing in fixed deposits.

• Guaranteed Returns: Fixed Deposits provide you with secure, predictable, and guaranteed returns, which are unaffected and untouched by market fluctuations.
• Flexibility in Tenure: The FD comes with a flexible tenure period starting from 7 days to 10 years, suiting your financial goals and repayment capacity.
• Tax-Saving Fixed Deposit: Most of the FDs come up with certain lock-in periods and deductions up to Rs 1.5 lacs under Section 80C of the Income Tax Act.
• Sweep-in / Sweep-out: A sweep-in / sweep-out feature automates your deposits. Your excess funds are automatically transferred from a savings account to an FD, and when your savings account balance falls below the set threshold, funds from the FD are transferred back.
• Senior Citizen Benefits: An additional benefit is usually an increase of 0.5% to 0.75% on the standard interest rate given to senior citizens (usually above 60 years) who invest in an FD.
• Loan Against Fixed Deposit: An FD is a reliable option to have in case of emergencies, in financial terms. It is quite simple to take a loan on a fixed deposit. You can borrow a loan of up to 90% to 95% of the amount of the fixed deposit, depending on the bank.
• Credit Card Against FD: These are secured credit cards where your fixed deposit serves as collateral. Most banks offer a credit card against an FD where you can use 80-90% of your deposit value as a secure credit.

How to Open a Fixed Deposit

Booking an FD is a quick and hassle-free process. You just need an active account with the bank or NBFC where you want to open your deposit. You can choose an online or offline method as per your comfort and convenience, and instantly book an FD.

Online FD Booking (Netbanking/App)

• Internet/Mobile Banking: Log in to your internet or mobile banking app.
• Deposits: Head to the "Deposits" Select the option to open a new Fixed Deposit.
• Amount & tenure: Choose your investment amount and the tenure.
• Payout frequency: Select how you want to receive your interest payments.
• Submit: Review all the details and click on the submit button.
• Get Receipt: Download your digital FD receipt immediately after booking.

Offline Method (Branch Banking)

• Branch visit: Visit your nearest bank branch during working hours.
• FD Form: Ask a bank official for an FD application form and fill in the deposit amount and your chosen tenure.
• Authorize: Sign the form to authorize the transfer from your account.
• Submit: Submit the completed form to the bank executive and wait for the bank to process your request.
• FD Receipt: Collect your physical FD booking receipt from the counter.

Documents Required to Open an FD

Banks and NBFCs need certain documents to verify your identity and book your FD. If you are an existing customer, the process is faster.

• Identity Proof: A PAN card is mandatory for all investors. You can also use your Aadhaar card or Passport.
• Address Proof: Use documents like your Voter ID or Driving License. Recent utility bills are also commonly accepted.
• Photographs: Keep two recent passport-size photographs ready.

Age Proof: This is vital for senior citizens to get higher rates. A birth certificate or school certificate is also valid proof.

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