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Government Banks That Offer The Best Interest Rates On Fixed Deposits
In the Indian market, fixed deposits are the investment that people rely on the most to make safe money because they are the least affected by market fluctuations. The interest rates on fixed deposits in the past 6 months have seen a decent hike as a result of the repo rate hike by the Reserve Bank of India (RBI).
Since May, banks, NBFCs or Post Offices have all hiked their Fixed Deposits (FD) rates on various tenors. Leading banks such as the State Bank Of India (SBI), Bank Of Baroda, ICICI Bank, HDFC Bank, and Punjab National bank have all increased their FD rates. In the Recent past week, banks such as Kotak Mahindra Bank, Indian Bank, Punjab & Sind Bank, Yes Bank and others have hiked their FD rates on select tenors.
It is challenging to locate government banks that offer high-interest rates on FD. However, with FD rates of up to 7% on non-senior citizen deposits from government banks are promising to major FD investors. When you select a FD with a higher interest rate, you can grow your money passively.
Here are the 5 leading government banks (Government of India Undertaking) that followed the rate hike trend and are now after the hikes offering high-interest rates on FDs. These banks are Indian Bank, Punjab National Bank, Canara Bank, Bank Of India, & Union Bank of India. Here are the interest rates offered by these banks:
Indian Bank
According to the bank's official website, the bank revised the interest rates on FD on 29 October 2022. The bank offers a maximum interest rate of up to 6.50% and a minimum of 2.80% on tenors starting 7 days to above 5 years on deposits below 2 Crore. According to the bank, for Domestic Term Deposit for Senior Citizens, additional rate of interest payable would be 0.50% p.a. for an amount up to Rs 10 crore. The additional rate would be offered on deposits of 15 days to 10 years over the card rate in respect of Short Term Deposits, Fixed Deposits and Money Multiplier Deposit Schemes. Here are the Interest rates on Fixed Deposits.
Interest Rates on Retail Domestic Term Deposits Below 2 Cr w.e.f 29.10.2022
| Period | Interest Rates (% p.a) |
|---|---|
| 7 days to 14 days | 2.8 |
| 15 days to 29 days | 2.8 |
| 30 days to 45 days | 3 |
| 46 days to 90 days | 3.25 |
| 91 days to 120 days | 3.5 |
| 121 days to 180 days | 3.85 |
| 181 days to less than 9 months | 4.5 |
| 9 months to less than 1 year | 4.75 |
| 1 year | 6.1 |
| Above 1 year to less than 2 years | 6.3 |
| 2 years to less than 3 years | 6.5 |
| 3 years to less than 5 years | 6.4 |
| 5 year | 6.4 |
| Above 5 years | 6.3 |
Source -Indianbank.in
Punjab National Bank
Punjab National Bank is the 2nd largest Public Sector in terms of the network. According to the bank's official website, the bank increased the FD rates below 2 Crore with effect from October 26, 2022, following the 50 bps repo rate increase by RBI. For the general public, the bank's interest rates on fixed-rate deposits (FDs) range from 3.50 percent to 7 percent annually, and for senior citizens (above 60 years), the bank offers an additional 0.30 percent above the senior citizen interest rates up to 5 years.
Interest Rates on Single Term Deposits below 2 Cr w.e.f. 26 October 2022
| Tenors | General Public (% p.a.) | Senior Citizen (% p.a.) | Super Senior Citizen (% p.a.) |
|---|---|---|---|
| 7 days to 14 days | 3.5 | 4 | 4.3 |
| 15 Days to 29 Days | 3.5 | 4 | 4.3 |
| 30 Days to 45 Days | 3.5 | 4 | 4.3 |
| 46 days to 90 days | 4.5 | 5 | 5.3 |
| 91 days to 179 days | 4.5 | 5 | 5.3 |
| 180 days to 270 days | 5.5 | 6 | 6.3 |
| 271 days to less than 1 year | 5.5 | 6 | 6.3 |
| 1 year | 6.3 | 6.8 | 7.1 |
| 1 year to 599 days | 6.3 | 6.8 | 7.1 |
| 600 Days | 7 | 7.5 | 7.8 |
| 601 Days to less than 2 years | 6.3 | 6.8 | 7.1 |
| >2-3 Years | 6.25 | 6.75 | 7.05 |
| >3-5 Years | 6.1 | 6.6 | 6.9 |
| >5-10 Years | 6.1 | 6.9 | 6.9 |
Source - pnbindia.in
Canara Bank
Canara Bank, another PSU bank in the list that recently raised the interest rate on its fixed deposits under Rs. 2 crores According to the bank's official website, the revised FD rates are effective from October 31, 2022. The Bank now offers FD with maturities ranging from 7 days to 10 years with interest rates starting from 3.25% to 7% percent for the general public and 3.25% to 7.50% for senior citizens. According to the bank's official website, Additional interest of 0.50% for Senior Citizens is available for Deposits (Other than NRO/NRE and CGA Deposits) less than Rs. 2 Crore and with tenor of 180 Days and above.
Interest rates On Domestic Fixed Deposits Below 2 Crore w.e.f 31.10.2022
| Period | General Public (% p.a.) | Senior Citizen (% p.a.) |
|---|---|---|
| 7 days to 45 days* | 3.25 | 3.25 |
| 46 days to 90 days | 4.5 | 4.5 |
| 91 days to 179 days | 4.5 | 4.5 |
| 180 days to 269 days | 5.5 | 6 |
| 270 days to less than 1 Year | 5.5 | 6 |
| 1 year only | 6.25 | 6.75 |
| Above 1 year to less than 2 years | 6.25 | 6.75 |
| 666 Days | 7 | 7.5 |
| 2 years & above to less than 3 years | 6.25 | 6.75 |
| 3 years & above to less than 5 years | 6.5 | 7 |
| 5 years & above to 10 Years | 6.5 | 7 |
Source- Canarabank.com
Bank Of India
Bank Of India is another leading government bank in the list that offers high-interest rates on FDs. The bank has recently revised the Interest rate on Domestic / NRO Term Deposits with effect from 1 November 2022, according to the bank's official website. After the modification, the bank interest rates on FD starts from 2.85% and goes up to 6.30% on deposits below 2 crores. The maturity period for the FD rate is 7 days to 10 years. According to the bank's official website, an Additional premium of 25 bps, over & above the existing 50 bps will be paid to Senior Citizens on their retail TD (Less than Rs. 2 Cr) for all the tenors of 3 Years & above i.e. 75 bps.
Interest Rates on Domestic/NRO Term Deposits Below 2 Cr w.e.f. 1 November 2022
| Tenors | Interest Rates (% p.a) |
|---|---|
| 7 days to 14 days | 2.85 |
| 15 days to 30 days | 2.85 |
| 31 days to 45 days | 2.85 |
| 46 days to 90 days | 3.85 |
| 91 days to 179 days | 3.85 |
| 180 days to 269 days | 4.6 |
| 270 days to less than 1 year | 4.6 |
| 1 Year to less than 2 Years (except 555 Days | 5.75 |
| 555 Days | 6.3 |
| 2 Years to less than 3 Years(Except 777 Days) | 5.75 |
| 777 Days | 7.25 |
| 3 Year to < 5 Year | 6.25 |
| 5 Year to < 8 Year | 5.75 |
| 8 Year and upto 10 year | 5.75 |
Source - bankofIndia.co.in
Union Bank of India
Union Bank Of India is 5th public sector bank on the this list that offers high interest rates on Fixed Deposits. The bank has recently hiked interest rates on FD post the repo rate hike By RBI. According to the Bank's official website, the bank's revised interest rates on FDs below 2 Crore are effective from 17 October 2022. The bank has raised the interest rates on retail FDs with maturities starting 7 days to up to 10 years. According to the bank's official website, the bank after the modification now offers interest rates starting from 3% to 7% for the said tenors.
Interest rates on Fixed Deposits below 2 Crore w.e.f. 17 October 2022
| Period | Interest Rate (% P.A.) |
|---|---|
| 7-14 Days | 3 |
| 15 -30 Days | 3 |
| 31-45 Days | 3 |
| 46 -90 Days | 4.05 |
| 91-120 Days | 4.3 |
| 121-180 Days | 4.4 |
| 181 Days to5.25 | |
| 1 Year | 6.3 |
| > 1 Year to 443 Days | 6.6 |
| 444 Days | 6.7 |
| 445 days to 598 days | 6.6 |
| 599 Days | 7 |
| 600 Days to 2 Years | 6.6 |
| > 2 Year to 3 years | 6.7 |
| >3 Year to 5 Years | 6.7 |
| >5 Years to 10 Years | 6.7 |
Source - unionbankofindia.co.in
