In order to earn regular monthly income after retirement, senior citizens always consider investing in bank fixed deposits (FDs). In the last year or so, though, declining deposit rates of banks have dramatically reduced their monthly retirement benefits because banks have lowered fixed deposit interest rates through tenures after steady repo rate declines by the Reserve Bank of India (RBI). In recent quarters, interest rates on small-savings schemes have also been lowered. Despite declining interest rates, there are still several banks that provide good returns for senior citizens on three-year FDs. Interest rates of up to 8.26% per cent on three-year FDs for senior citizens are currently provided by Shriram Finance FDs (AA+ rated by CRISIL).
|Banks / Corporate||ROI (p.a.) for general public||ROI (p.a.) for senior citizens|
|Shriram Transport Finance||7.76%||8.26%|
|Yes Bank Special FD||7.00%||7.75%|
|Fincare Small Finance Bank||6.90%||7.40%|
|Lakshmi Vilas Bank||6.00%||6.50%|
|ICICI Home Finance||6.10%||6.35%|
Compared to the interest rates provided by public sector banks these interest rates on three-year FDs are much attractive. For instance: for elderly people, DCB Bank and RBL Bank offer 7.45 percent interest on their three-year FDs. On its three-year FDs, IndusInd Bank provides 7.25 per cent interest. For senior citizens, prominent private banks such as ICICI Bank and HDFC Bank offer 5.65 percent and 5.80 percent interest rates on three-year FDs. If we look at the public sector banks, Canara Bank provides the pretty decent interest rate of 6 per cent interest for senior citizens on its three-year FDs whereas Bank of India and the State Bank of India (SBI) bid senior citizens 5.8 per cent returns on their three-year FDs.