Looking for a way to get guaranteed savings on your hard-earned money? Fixed deposits have always been a famous and an easy choice of people. This is so because they provide you with guaranteed returns at the time of maturity at Best FD interest rates, irrespective of the market trends.
So, how does a fixed deposit account work? When the applicant opens a fixed deposit account. He puts a certain amount of money with the bank for a certain period of time at a mutually agreed FD interest rate. After the deposit term ends or at the maturity date. The depositor will get the invested amount with the calculated compound interest.
The returns on fixed deposits are calculated at a certain rate. This rate of return is fixed and known as the FD interest rates. The rate is determined by the bank at the time of booking or opening of the fixed deposit account. and remains the same throughout the term of deposit. Thus, the depositor receives the returns on the invested amount at the regular and fixed deposit rates.
Now that you have known enough about the fixed deposits. Let us have a look at the best FD interest rates in India provided by different banks. These interest rates for fixed deposits will ease your work and help you choose the right bank for yourself.
All Banks Fixed Deposit Interest Rates October 2022
Want to take your fixed deposit amount to a high? Then, compare the best FD interest rates in India offered by the famous banks. Look, analyse and compare these interest rates for fixed deposits.
|Banks||FD Interest Rates|
|Allahabad Bank||2.90% - 5.65%|
|Andhra Bank||3.00% - 5.40%|
|Axis Bank||2.50% - 6.50%|
|Bandhan Bank||3.00% - 5.75%|
|Bank of Baroda||2.90% - 6.30%|
|Bank of India||2.85% - 5.55%|
|Bank of Maharashtra||2.75% - 6.40%|
|Canara Bank||2.90% - 5.75%|
|Central Bank of India||2.75% - 5.50%|
|Citibank||2.00% - 4.25%|
|Corporation Bank||3.00% - 5.40%|
|Dena bank||2.90% - 6.30%|
|Federal Bank||2.50% - 6.00%|
|HDFC Bank||2.50% - 6.25%|
|HSBC Bank||2.25% - 4.50%|
|ICICI Bank||2.50% - 6.30%|
|IDBI Bank||2.90% - 5.90%|
|IDFC Bank||2.50% - 5.75%|
|IndusInd Bank||2.50% - 6.00%|
|Jammu & Kashmir Bank||3.00% - 5.80%|
|Karnataka Bank||3.50% - 6.20%|
|Karur Vysya Bank||3.50% - 6.15%|
|kotak Mahindra Bank||2.50% - 4.90%|
|Lakshmi Vilas Bank||3.60% - 7.50%|
|Nainital Bank||3.35% - 6.85%|
|Oriental Bank of Commerce||2.90% - 5.75%|
|Punjab & Sind Bank||3.00% - 5.80%|
|Punjab National Bank||2.90% - 5.75%|
|RBL Bank||3.25% - 7.45%|
|SBI||2.90% - 6.20%|
|Standard Chartered Bank||1.50% - 6.10%|
|Syndicate Bank||2.90% - 5.75%|
|UCO Bank||2.75% - 5.50%|
|United Bank Of India||2.90% - 5.75%|
|Vijaya Bank||2.90% - 6.30%|
|YES BANK||3.25% - 7.25%|
What is the process of Interest Calculation on the Fixed Deposit of Different Banks?
Now that you know the best FD rates in India. You must want to know about the process that banks use to calculate interest on the said product. There are two processes through which banks offer interest on fixed deposit schemes. These are Cumulative and Non-cumulative bank interest rates calculations. The option to choose between these two depends solely on you. Don’t worry, as we will be telling you about both these processes in detail so that you can make a better decision.
Cumulative Interest Calculation:
In this process of FD interest rate calculation, you deposit a fixed amount of money for a definite period. The fixed deposit interest will be calculated on a quarterly basis by default. And at the end of every quarter, your interest amount will be reinvested with the principal amount. The whole accumulated amount will be paid to you at the time of maturity. Which can be as short as 7 days to as long as 10 years.
This process is generally opted by those who want to save and earn a large amount at the end of the long investment period. You can only get principal and accumulated fixed deposit interest at the end of the maturity period.
For example, if you invest an amount of INR 4,00,000 for a period of 4 years at an FD interest rate of 8.1% per annum, then at the end of your maturity period you will get a total amount of INR 5,90,457 including interest of INR 1,90,457.
Non-Cumulative Interest Calculation:
In this process, the FD interest rate on your deposited amount is calculated on a monthly, quarterly, half-yearly, and yearly basis. The calculation process depends on your choice. The fixed deposit interest rates will be paid to you at the frequency of interest chosen by you and it will not be reinvested in the principal amount again. So, you need to remember this thing while choosing any of the non-cumulative interest calculation options.
Individuals who are looking for a fixed amount as a stable income at the end of a definite interval find this process beneficial for them. One of the examples is of the Senior Citizens who also enjoy higher fixed deposit rates. As compared to the standard rate of interest and want a fixed source of income during their retirement years.
For Example, if you invest an amount of INR 10,000 for a period of 1 year at an FD interest rate of 7.6% per annum. The amount you get at different frequencies can be seen in the table given below.
|Frequency||Interest Rate||Interest Payout (In ₹)|
Frequently Asked Question
1. Which bank is best for fixed deposit account opening?
For getting the maximised returns on your fixed deposits, you need to search and choose the best bank that is providing you with best FD interest rates accompanied with lesser penalty charges. The choice of bank totally depends on the depositor and his needs. You need to analyse all of the factors such as the amount you wish to deposit, the tenure of your FD and your expected returns. After analysing all these factors, you should choose the bank accordingly.
2. Can I get a monthly rate of interest on fixed deposits?
Yes, it depends on the method of interest calculation you choose on your FD account. The fixed deposit rate of interest can be calculated on a monthly basis, quarterly, half-yearly and yearly basis as well.
3. Do banks charge penalty fees for premature withdrawal of fixed deposit?
Yes, banks do charge a penalty if the depositor prematurely withdraws the deposited amount as it is a loss to the bank.
4. Do I need to pay tax on fixed deposit interest amount?
Yes, the interest earned on your fixed deposit is taxable. According to the Income Tax Act 1961, if the interest on your FD exceeds Rs.40,000 in a financial year, a TDS of 10% is applicable on the interest amount, that is to be paid by the taxpayer.
5. Should I invest in fixed deposits? Is it a good option?
If you want to go for a risk-free investment option, fixed deposits are the best method to save money. You will guarantee returns on maturity of your FD account at the agreed rate of interest. The returns do not depend on the market fluctuations. You will get the returns according to the rate of interest decided at the time of account opening.
6. What is the tenure range for a fixed deposit account?
The tenure range for a fixed deposit account usually ranges from as short as 7 days to a period of 10 years.
7. Which NBFC is best for fixed deposit?
Hawkins Cooker Ltd. offers the highest interest rate on your fixed deposit amongst all the other NBFC. Mahindra & Mahindra Financial Services Limited, Shriram City Union Finance, KTDFC Ltd are als some examples of NBFC that offer more than 10% interest rate on your fixed deposit.
8. Which bank is best for FD for 1 year?
The bank that would offer you the highest interest rate on your fixed deposit investment for 1 year would be the best bank for you. However, you would have to choose between the cumulative and non-cumulative bank interest rates calculations to get the best bank.
9. Do all NBFCs offer the option of opening an FD account with them for a period of 10 years?
No, it is not necessary that all the NBFCs offer the option of opening an FD account with them for a period of 10 years. However, it is important to check the tenure before opening an FD account.
10. What is the maximum exemption that I can get under tax saver FDs?
You can make an investment by opening a Tax-saving FD which enables you to save tax under section 80C of the Income Tax Act. Moreover, the maximum tax exemption limit is upto INR 1.5 lakh.
11. Under which section of the Income Tax Act is the tax benefit offered on tax saver FDs?
The Section 80C of the Income Tax Act offers the tax benefit on tax saver FDs.