Fixed Deposit India

Investment

Rs. /-

Interest Rate

%

Interest Earned

Rs. /-

Maturity Value

Rs. /-
Investment Amount Minimum - Rs. 1,000 Maximum- No Maximum Limit
Tenure Minimum - 7 days Maximum- 10 Years
Seamless Transfers Transfer Funds easily from a saving Account to a fixed deposit to earn higher interest
Hassle-Free Opening Open fixed deposits form Home/Office

FD Interest Rates in India for Less Than 1 Year

Bank Tenure Interest Rate
Kotak Mahindra Bank 181 days to 363 days 6.50%
Axis Bank 6 months to 8 months 29 days 6.25%
State Bank Of India 180 days to 210 days 6.35%
ICICI Bank 61 days to 184 days 6.00%
HDFC Bank 46 days to 6 months 5.75%
Bank of Baroda 91 days to 180 days 5.50%
IDFC Bank 91 days to 180 days 6.75%

A conventional fixed deposit scheme is an excellent option to preserve a part of your savings. It offers a uniform interest flow that could be a lot reliable than equity investments or mutual funds. However, when selecting a fiscal institution to take the deposit from, you should thoroughly consider some significant aspects.

The initial step in finding the standard fixed deposit rates will be to pitch out your exact requirements.

  • Are you thinking to go for prolonged term investments?
  • Are you ready to take risks?

You may not be certain! You may invest in the longer course, but there are opportunities, and you can obtain the sum before the predetermined period.

Based on few facts and figures, you can choose the best fixed term deposit.

Finding the Right Financial Organization & the Service:

It is recommended to look for banks, instead of organizations that issue fixed deposit policies for the investors. Some banks offer decent interest rates in a short period, and others may provide better interest in longer run. The interest rates allowed by the banks change regularly. You need to check the freshest rates provided by the different banks from their respective websites.

Go for a Company only if:

A lot of organizations also offer FD policies. The interest rates are lucrative. Though, most of the organizations live up to the promise, others may be a Ponzi scheme.

To avoid any kind of disenchantment, read about the company over the internet, see if it is a listed and trustworthy name, and also that it has no history of fraudulent activities.

A little hard work and research will fetch you a great benefit in the minimum time possible. All you need to do is deposit your saved funds in the bank account and see your money multiply with time. Ensure that you benchmark with multiple sources to keep maximum alternatives available with yourself. 

Top 10 Banks Fixed Deposit Interest Rates in India

Bank Name Tenure Interest Rate(p.a.)
Axis Bank 7 days - 10 years 3.50% - 6.90%
Bank of Baroda 7 days - 10 years 4.25% - 6.60%
Bank of India 7 days - 10 years 5.25% - 6.25%
Canara Bank 7 days - 10 years 4.20% - 6.00%
Central Bank of India 7 days - 10 years 4.75% - 6.50%
HDFC Bank 7 days - 10 years 3.50% - 6.00%
ICICI Bank 7 days - 10 years 4.00% - 6.50%
State Bank Of India 7 days - 10 years 5.75% - 6.75%
Yes Bank 7 days - 10 years 5.00% - 7.00%

Top 10 Banks Fixed Deposit Interest Rates in India for Senior Citizens

Fixed deposits are an ideal savings instrument for people belonging to every age group. However, the highest interest rates on FD are offered to the senior citizens. Typically, fixed deposit schemes are chosen by senior citizens who wish to invest their money in safe avenues. It offers dual benefits. Firstly, it ensures that the funds are safe. Secondly, it acts as additional income as the highest FD rates are offered to senior citizens.

Bank Name Tenure Interest Rate(p.a.)
Axis Bank 7 days - 10 years 3.50% - 7.15%
Bank of Baroda 7 days - 10 years 4.75% - 7.10%
Bank of India 7 days - 10 years 5.25% - 6.75%
Canara Bank 7 days - 10 years 4.70% - 6.50%
Central Bank of India 7 days - 10 years 5.25% - 7.00%
HDFC Bank 7 days - 10 years 4.00% - 6.50%
ICICI Bank 7 days - 10 years 4.50% - 7.00%
State Bank Of India 7 days - 10 years 6.25% - 7.25%
Yes Bank 7 days - 10 years 5.50% - 7.50%

Best Company Fixed Deposit 2018

A company fixed deposit is an investment where non-banking financial institutions/ companies accept deposits by investors. It offers a stipulated return on fixed deposits for a fixed time period. The interest on fixed deposit of financial firms is higher than the interest rate offered by banks. The highest interest rates on FD come with a higher risk. While bank fixed deposits are more secure, company deposits aren’t. It means, in case a company faces bankruptcy, the investors can’t sell their document in order to recover the funds.

Before going for a company deposit, investors consider company funds based on the credit rating of the top companies. Companies having a credit rating of AAA or AA indicate that the company has the required basic performance strength. Typically, ratings below AAA or AA reflect poor performance. It means, it is highly risky to invest in their fixed deposit schemes. Before signing up for a fixed deposit account, make sure to check the interest rate offered by the company.

Given below is a Revised List of High-Paying Company-FDs for 2018:

Name of Company Fixed Deposit Term Interest On Fixed Deposit (Regular)  Interest On Fixed Deposit (Senior)

Mahindra Finance

Three years

7.80 percent per annum

 

Sundaram Home Finance

Three years

7.25 percent per annum

9.40 percent per annum

HUDCO

Two years - Three years

9.00 percent per annum

9.25 percent per annum

HUDCO

One year

9.15 percent per annum

8.50 percent per annum

Kerala Transport Development Finance Corporation Ltd (KTFDC)

One year

8.25 percent per annum

7.75 percent per annum

LIC Housing Finance Limited

One year

7.30 percent per annum

7.40 percent per annum

Shriram City Union Finance

One year

7.50 percent per annum

7.70 percent per annum

Note

  1. FD interest rates in India changes from time to time.
  2. Interest on fixed deposits for senior citizens can vary from 7 percent per annum to 9.40 percent per annum.

10 Things to Know About Tax-Saving Fixed Deposit Account

As per Section 80C of the Income Tax Act, fixed deposit account holders can claim a tax deduction for investment(s) up to 1.5 Lakh Rupees in a tax-saving fixed deposit account. The invested amount is deducted from the gross total income to compute a person’s taxable income.

Here are 10 Things to know about a Tax-Saving Fixed Deposit Account:

  1. Who can invest Only HUFs and individuals can opt for tax- saving fixed deposit schemes.
  2. Minimum Amount - While a fixed deposit account can be opened in any bank, the minimum amount to be invested varies as per a bank’s terms and conditions.
  3. Lock-In Period - These fixed deposit schemes come with a lock-in period of five years. Loan against FDs and Pre-mature withdrawals are strictly not allowed.
  4. How to Invest - An individual can invest in tax saving FDs very easily. Many public and private sector banks offer the facility of opening a fixed deposit account. The only exception is rural and co-operative banks.
  5. Post Office Fixed Deposit Scheme - Investment in post office fixed deposit scheme with a duration of five years is eligible for a tax deduction as per section 80 (C) of the IT Act, 1961.
  6. Transfer ability - Fixed deposit account in post offices are eligible for transfer from one post-office branch to another.
  7. Type of Account - An individual can hold tax saving fixed deposit in ‘single mode’ or ‘joint mode’ as per his/her preference. If the opted type is a joint account, the tax benefit can be claimed only by the first account holder.
  8. TDS Applicability - According to the tax bracket of a person, a tax is levied on the interest earned on a fixed deposit account. Hence, Tax Deducted at Source (TDS) is applicable. The interest on the deposit amount is payable on monthly/quarterly frequency. Additionally, account holders or can re-invested the earned interest.
  9. Nomination Facility - A Fixed deposit offers nomination facility.
  10. Additional Benefits - Mostly, FD interest rates of all banks are higher for senior citizens.

Fixed Deposit Compound Interest Calculator

A compound interest calculator is used to compute the interest amount as well as the maturity amount at a compounding rate of interest. It is widely used to compute the amount that would be credited to the FD account holder under reinvestment deposit schemes. It is a free and easy tool that computes the compound interest for a fixed deposit on the basis of principal deposit amount, interest rate and the deposit duration.

Fixed Deposit Interest Calculator

FD calculator is a user-friendly and convenient financial tool that is easily available online. Fixed deposit interest calculator can be used in a matter of a few seconds. All an individual needs to do is type fixed deposit interest calculator in his/her Google search bar and various results will be displayed. By using fixed deposit interest calculator, an individual can instantly calculate how much interest he/she will earn on his/her deposit.

How does a Fixed Deposit Interest Calculator Work?

Fixed deposit interest calculator computes the interest earned by a fixed deposit using the following components.

  1. Amount to be Deposited: It is the principal amount an FD holder invests in a fixed deposit. The amount is invested only once and an individual can decide the amount as per his/her investment goals.
  2. Deposit Term: It’s the time duration for which the amount is invested in an FD. Deposit term can vary from 7 days to 10 years.
  3. Interest Rate: It’s the rate at which interest will be earned on the deposit amount. It is formulated on the basis of deposit amount and tenure. Once an individual has entered the details mentioned above, the fixed deposit interest calculator displays the amount which will be paid out at the time of maturity.

Income Tax and Fixed Deposit Interest

How is income earned by interest is taxed?

As mentioned earlier, income earned by interest is fully taxable. It’s added to the total income and taxed as per the applicable tax slab. It falls under the category ‘Income from Other Sources’ in the Income Tax Return.

Why TDS?

When an individual receives certain payments, the payer is legally bound to deduct a tax before making those payments. The tax deducted is known as TDS and has to be deposited with the government. After deducting the TDS, the payee will receive the net amount Who, in turn, will have to add the gross amount to his/her income to adjust TDS against his/her final tax liability.

Banks deduct Tax Deducted at Source on income earned by interest as it is accumulated. Some people tend to believe that banks deduct tax at the time a fixed deposit matures and the earned interest is credited. However, bank will deduct TDS at the end of every financial year.

When to Pay Tax on Income Earned by Interest?

In case an FD holder is supposed to pay the tax on his/her income earned by interest, he/she must pay it before the end of a financial year i.e. 31st March.

Note- If an FD holder earns a large income from interest, then he/she must pay tax may on a quarterly basis.

Fixed Deposit (FD) vs. Recurring Deposit (RD)

Both recurring deposits and fixed deposits offer interest on the deposit amount. However, there is one single feature that one ought to be aware of. Both RDs and fixed deposits have a deposit term but in fixed deposit, one has to deposit an amount just once while investors investing in recurring deposit must deposit a fixed amount in stipulated intervals.

Fixed Deposit

Investors who want to invest their money in the fixed deposits have to select a term, that typically ranges from 7 days - 10 years, and he/she must deposit a fixed amount once. The interest on these deposits would be credited to the investor’s account on a monthly/ quarterly basis (as opted).

Recurring Deposit

Investors who want to invest their money in recurring deposits can deposit a fixed amount on a monthly basis and earn interest. The interest would be credited along with the capital at the time of maturity.

The difference between recurring deposits vs. fixed deposits is listed below.

Basis Fixed Deposit Recurring Deposit

Term

Generally, fixed deposit schemes are offered for 7 days - 10 years. The account holder can opt for deposit term as per his investment goals.

Usually, deposit term for recurring deposits varies from 1 year - 10 years. The account holder needs to deposit a stipulated amount during regular intervals over opted deposit term.

Interest Rate

On per annum basis, interest rate varies between 6.96 percent - 8.00 percent as per deposit amount and opted term.

On per annum basis, interest rate varies between 6.96 percent - 8.00 percent. Typically, the rate of interest for RD varies on basis of deposit term and investment amount.

Minimum and Maximum Limit

A fixed deposit doesn’t come with any restriction on the investment amount. That being said, banks decide and set the minimum investment amount as Rs. 100 and the maximum investment amount is Rs. 1.5 lakh.

There isn’t any minimum or maximum limit as such. Usually, it varies from bank to bank. Typically, banks set the minimum investment amount as Rs. 1000 and the maximum limit as Rs. 15 lakhs each month.

Withdrawal

By the end of deposit tenure, premature withdrawal is allowed. The fixed deposit account holder will have to pay a penalty, however.

No premature withdrawal is allowed.

Required Documents

Proof of identity and proof of address are required to open a fixed deposit account.Additionally, as per the requirement of the bank, customers need to submit documents such as PAN card, passport, & income documents.

Proof of identity and proof of address are required to open an RD.Additionally, as per the requirement of the bank, customers need to submit documents such as PAN card, passport, & income documents.

Tax Benefits

Under section 80C of IT Act, 1961, fixed deposit accountholders can claim tax benefits.

No tax will be deducted in case earned interest on RD is up to 10, 000 Rupees.

Taxability

Interest earned on the fixed deposit account is taxable. Majorly, banks deduct TDS.

Interest earned on the RD is taxable. Majorly, banks don’t deduct TDS.

Extra Benefits

Loan facility is offered.

No facility as such.

Fixed Deposit Maturity Calculator

Maturity calculator is a financial tool that is used to compute the maturity amount i.e. the returns on the fixed deposit. This tool is easily available online and is quite similar to fixed deposit interest calculator. It computes maturity amount on the basis of various details of a fixed deposit, like the principal deposit amount, deposit term and the rate of interest.

Fixed Deposit Account Rules Every Investor/ Potential Investor Ought to Know

Here are the fixed deposit account rules that are a must to know for every investor as well as a potential investor.

  1. Tax Deducted at Source (TDS)- Interest earned on bank fixed deposit is taxable. It means, income earned as interest is credited to the income and will be taxed as per the applicable tax slabs. In case the income earned from interest for a financial year is greater than 10,000 rupees, banks levy TDS @10 percent on the earned interest.
    Note- In case the fixed deposit account holder hasn’t provided his/her PAN (permanent account number), the bank will deduct Tax Deducted at Source@ 20 percent.
  2. Loan/Overdraft Facilities- Overdraft or loan facility against fixed deposits is available. For example, State Bank of India offers the facility of loan/overdraft of up to 90 percent of the principal amount. SBI charges 1 percent higher interest than the interest earned on the fixed deposit.
  3. Insurance of Fixed Deposit- It is also known as deposit insurance. Basically, it’s a protection cover that an FD holder gets on his/her deposit in the bank. This facility is provided by Deposit Insurance and Credit Guarantee Corporation. DICGC is a subsidiary of the Reserve Bank of India (RBI). The insurance premium is paid by the banks. If a bank is bankrupted, DICGC would provide a maximum sum of1 lakh Rupees to every FD holder for the principal as well as interest amount.
  4. Clubbing of Interest Income: Interest earned from FD or RD is clubbed across all bank branches for 2 main purposes.
    1. For calculating the total interest earned by an FD holder during a specific financial year.
    2. For calculating the applicability of Tax Deducted at Source.
  5. Form 15G/15H: To prevent TDS, an FD holder can submit either Form 15G or 15H to the bank. These are self-declaration forms that can be submitted by an FD holder. The form states that an FD holder’s total income doesn’t fall in the taxable income bracket.
    If an FD holder fails to do so, he/she can claim tax refund while filing his/her income tax return.
  6. Minor or spouse: Many FD holders tend to think that one can avoid tax deduction by investing their money in the name of their minor child or non-working spouse. This is a myth which needs to be bused right now. If an FD holder invests in a bank FD in the name of his/her non-working spouse or minor child, the earned interest income would be accredited to his/her income. It will be taxed as per his/her income tax slab.
  7. Cumulative deposits: In case an FD holder has opted for a cumulative deposit to get the earned interest at the end of the deposit term, tax experts recommend declaring the income earned by interest every year. It’s because, his/her bank might deduce the applicable TDS and deposit it as per his/her PAN. If an FD holder doesn’t declare his/her interest income, it will reflect a mismatch in his/her 26AS statement i.e. tax credit statement and the return filed by him/her.

Frequently Asked Questions (FAQs)

Mentioned below are the frequently asked questions related to a fixed deposit account.

1. Is interest on fixed deposit is compounded?

Ans - Generally, the interest on fixed deposit is compounded and is credited along with the principal sum when the deposit matures.
However, in case the fixed deposit account holder opts to get interest credited on a monthly or quarterly basis, then a compound interest isn’t offered.

2. What’s a re-investment plan in an FD account?

Ans - A re-investment planis a type of term deposit. Rather than the interest being credited at an opted regular frequency, the interest is credited at the end of maturity period. At the time of maturity, the regular interest, as well as the principal sum, are paid out.

3. Can I get fixed deposits interest credited to my account on a monthly basis?

Ans - Yes. The periodicity of the interest paid for a fixed deposit depends on your preference.

4. How can I compute FD interest rates in India?

Ans - It is very simple. You can use fixed deposit interest calculator, fill in the asked details and that’s it. The tool is available online. All you have to do is type fixed deposit interest calculator and conduct a Google search.

5. What are the factors that impact fixed deposit rates in India?

Ans -The factors that impactfixed deposit rates in India are mentioned below.

Present Scenario of the Nation’s Economy

Gross domestic product i.e. the value of the total goods & services produced in India during a specific time period reflects the present scenario of the nation’s economy. In case it increases, it means India’s economy is prospering and hence, FD rate of interest will also increase.

Monetary Policy of Reserve Bank of India

Banks in the country borrow money from the Reserve Bank of India. The interest rate at which the money is borrowed is known as the repo rate. If there is an increase in repo rates then the banks will enhance their interest rates on FDs (and loans).

Effect of Recession and Inflation

Inflation is the rate at which cost of goods & services increases. In order to control inflation, the interest rates are hiked so that people will be tempted to save more. When inflation decreases, the rate of interest is decreased. As a result, they borrow money and spend more.

The Reserve Bank of India makes the best use of interest rates to tackle inflation. Last year, RBI reduced the repo rate by 0.25 percent to decrease inflation.

6. What is the minimum amount that can be deposited in an FD account?

Ans - There is no limit as such. But, it varies bank to bank.

7. What are the pre-requisite documents for opening a fixed deposit account?

Ans - Here are the documents that are a must-have for opening afixed deposit account.

Proof of Identity

  • Aadhaar card
  • PAN card
  • Driving license
  • Voter ID card
  • Government ID card

Address proof

  • Passport
  • Electricity bill
  • Telephone bill
  • Bank Statement with a cancelled cheque

8. Is the rate of interest on FD for senior citizens is higher as compared to regular FD?

Ans - Majorly, banks offer highest interest rates on FD for senior citizens. It ranges from 4.50 percent – 8 percent.

9. What’s the minimum and maximum term for which I can open a fixed deposit account?

Ans - There is no minimum duration for an FD. Typically, the minimum duration for an FD is 7 days, and the maximum duration is 10 years.

10. Do I have to pay tax on my FD income?

Ans - Typically, banks deduct TDS on the interest in case the interest-earned income through the fixed deposit is more than 10,000 Rupees per annum. The TDS is deducted at the rate of 10 percent on the income earned by interest if your account is linked with your PAN number. If your account isn't linked with your PAN, the bank, then TDS is deducted at the rate of 20 percent on the income earned by interest.

11. Who can invest in FDs?

Ans - In case you are a resident of India, you can invest in FD schemes, regardless of your age. Apart from that, Hindu Unified Family (HUFs), private or public Ltd. co. and partnership firms are eligible to invest in a fixed deposit account.

12. Does investment made into term deposits provide any benefits?

Ans - Yes. It offers multiple benefits such as high tax highest interest rates on FD, tax saving benefits, etc.

13. Can I redeem my fixed deposits before the original term?

Ans - Yes. A fixed deposit can be closed before its maturity term. In case you close your Fixed Deposit before its maturity, the interest will be credited at the rate as applicable on deposit date for the duration the amount was deposited in the bank.

When a fixed deposit is withdrawn before maturity, it is called a premature withdrawal. A few banks charge a penalty for premature withdrawal.

14. When can I renew my FD?

Ans - You can renew a deposit at the end of its maturity period for the same deposit term.

15. Are there any loans offered against fixed deposits?

Ans - Yes. If you want to withdraw your deposit prematurely, you can consider taking a loan against your FD. This way, you won’t have to pay any penalty, and you will get ample funds to manage your finances. Additionally, you will earn interest on the fixed deposit. You can take a loan of up to 70 percent - 90 percent of your principal amount. Generally, the interest on the loan is charged 2 percent to 2.5 percent higher than the interest rate offered by your Fixed Deposit. Still, the rate of interest is lesser than that of a personal loan.

16. Can I go for an auto-renewal option at the time of opening a fixed deposit account?

Ans- Yes. You can select auto renewal facility at the time of opening a fixed deposit account. Additionally, you can get in touch with your bank and opt for auto-renewability anytime before the maturity of your FD. Auto-renewal facility enables your fixed deposit to get renewed by default for the same fixed deposit term.

17. Why does the rate of fixed deposit keep on changing?

Ans -There are various factors that influence banks to change the interest rate of fixed deposits. A few factors are mentioned below.

  1. Deposit rates share a relationship with the inflation rate- Ideally, banks should offer positive returns to the depositors. Investors should keep a tab on the inflation rate as it affects the lending rates. There can be times when depositors might get negative returns due to high inflation.
  2. Present Liquidity of the Country- When there is sufficient liquidity, banks don’t focus on FDs to fulfill their financial goals, unlike the times when there is tight liquidity. During such times, banks turn the fixed deposits. As a result, the bank Fd rates can change.
  3. Demand and supply scenario- When the demand for credit is less, usually bank FD interest rates are decreased and vice-versa. Typically, banks cut interest on fixed deposit when a cut is anticipated on the lending rate.
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