Bank fixed deposits (FDs) by far have been the most basic investment option looked upon by all investors irrespective of age group owing to their safety. Senior citizens on regular FD products generally get 0.5% higher interest rate than general category investors. Also, some of the banks from both private and public space have rolled out special FD schemes for senior citizen category. Here is elaborated what is being offered by different banks:
The special fixed deposit scheme for senior citizens by State Bank of India referred to as 'SBI We Care' offers 80 basis points higher interest rate than existing market rates applicable to them. 1 basis point is one-hundredth of a percentage point. So, such an FD with tenure of 5 years and above would fetch interest rate of 6.2% per annum. The scheme is available until September 30, 2020 and the rates came into effect from May 27, 2020.
2. HDFC Bank:
The special FD scheme for senior citizens from the bank by the name HDFC Senior Citizen Care FD offers return which is 75 basis points higher, thus fetching 6.25% return per annum. Under the scheme a premium of 25 basis points or 0.25% extra is payable to senior citizens' as against the current premium of 0.5%. The FD scheme for 5 years and above is valid for all new as well as renewal of senior citizen FDs amounting to less than Rs. 5 crore. The FD scheme is on offer from May 18 and closes on September 30, 2020.
3. Bank of India special FD scheme for senior citizens:
This state run bank also offers 25 bps premium over and above the existing rate of 0.5% i.e. 0.75% to senior citizens who book their FD of an amount less than Rs. 2 crore for a period of 5 years and above i.e. 6% return per annum.
4. IDBI Bank Special FD for senior citizens:
IDBI Naman Senior Citizen Deposit Scheme offers 0.1% higher return than what is otherwise pegged for senior citizens i.e. a premium of 0.5% in comparison to regular investor category. The limited period offer for FD period of 3 years and up to 7 years will fetch a return of 6%. The scheme remains open until September 30, 2020.
5. ICICI Bank:
Named 'ICICI Bank Golden Years FD', the scheme offers senior citizens an interest rate of 6.55% per annum for deposits up to Rs 2 crore with a tenure of more than five years to 10 years.So, in comparison to regular FD rates, the scheme fetches 80 bps higher return. Also, it is 30 bps more than the previous rates offered by the Bank. The scheme is available from May 20 to September 30, 2020. Also, investors in the scheme can secure loan against their FDs up to 90% of principal and accrued interest.