Top 10 Banks Offering Best Returns On 5-Year Tax Saving Fixed Deposits In 2021

For investors with a low-risk profile, new investors, or senior citizens, fixed deposits (FD) are always the best to bet. It is an investment vehicle under the debt category that not only generates guaranteed returns but also allows tax benefits under section 80C, flexible tenure, and deposit insurance cover up to Rs 5 lakh by DICGC where depositors can claim their money within 90 days if their banks go under a moratorium.

Here we are talking about fixed deposits for 5-years where our readers, especially debt investors need to keep in mind that the tax benefits up to Rs 1.5 lakhs under section 80C will only apply if they stay invested for 5-years of lock-in period which simply states that they can not make a premature withdrawal. By summing up all these factors, here we have compiled the top 10 public sector, private sector, and small finance banks that are now promising higher returns on fixed deposits of up to 5 years or tax-saving fixed deposits of less than Rs 2 Cr.

Top 10 Small Finance Banks Offering Good Returns On 5-Year Tax Saving FDs

When it comes to fixed deposits, small finance banks always offer higher returns to both regular and senior citizens compared to the leading private and public sector banks. But as a matter of concern for the safety of their deposits, let me remind the investors that they can enjoy the deposit insurance cover provided by DICGC across small finance banks also. For higher returns along with deposit safety, customers can open a fixed deposit account for 5-years in any of the below-listed small finance banks respectively.

Sr No.	Banks	Regular FD Rates	Senior Citizen FD Rates	Tenure	W.e.f.
1	Ujjivan Small Finance Bank	6.75%	7.25%	3 Years and 1 Day to 5 Years	March 5, 2021
2	Jana Small Finance Bank	6.75%	7.25%	3 years to less than 5 years	07.05.2021
3	Fincare Small Finance Bank	6.75%	7.25%	59 months 1 day to 66 months	29 July, 2021
4	North East Small Finance Bank	6.50%	7.00%	1096 days to less than 1825 days	April 19, 2021
5	Equitas Small Finance Bank	6.25%	6.75%	4 years 1 day to 5 years	June 1, 2021
6	Suryoday Small Finance Bank	6.25%	6.50%	5 years	June 21, 2021
7	Utkarsh Small Finance Bank	6.00%	6.50%	701 Days to 3652 Days	July 1, 2021
8	Capital Small Finance Bank	6.00%	6.50%	1 Year to less than 5 Years	June 3, 2021
9	AU Small Finance Bank	6.00%	6.50%	45 Months 1 Day to 60 Months	June 23, 2021
10	ESAF Small Finance Bank	5.25%	5.75%	1821 days to 3653 days	02.05.2021
Source: Bank Websites

Top 10 Private Sector Banks Promising Higher Returns On 5-Year Tax Saving FDs

After small finance banks, private sector banks offer the best returns on fixed deposits to both regular and senior citizen investors. By keeping deposit insurance cover benefits and higher returns in mind, here we have compiled the top 10 private sector banks that are now promising higher interest rates on 5-year deposits.

Sr No.	Banks	Regular FD Rates	Senior Citizen FD Rates	Tenure	W.e.f.
1	RBL Bank	6.50%	7.00%	60 months	July 2, 2021
2	DCB Bank	6.50%	7.00%	36 months to 60 months	May 15, 2021
3	Yes Bank	6.25%	7.00%	3 years to less than 5 years	June 3, 2021
4	IndusInd Bank	6.00%	6.50%	Indus Tax Saver Scheme (5 years)	July 23, 2021
5	IDFC First Bank	5.75%	6.25%	5 years	May 1, 2021
6	Axis Bank	5.40%	5.90%	3 years to 5 years	22.06.2021
7	ICICI Bank	5.35%	5.85%	5 Years (80C FD)	21.10.2020
8	HDFC Bank	5.30%	5.80%	3 year 1 day- 5 years	May 21, 2021
9	Bandhan Bank	5.25%	6.00%	3 years to less than 5 years	June 7, 2021
10	Kotak Mahindra Bank	5.20%	5.70%	4 years and above but less than 5 years	July 23, 2021
Source: Bank Websites

Top 10 Public Sector Banks Providing Best Returns On 5-Year Tax Saving FDs

For deposit amounts of less than Rs 2 Cr, here are the top 10 public sector banks offering the best interest rates on 5-year fixed deposits to both regular and senior citizens in 2021.

Sr No.	Banks	Regular FD Rates	Senior Citizen FD Rates	Tenure	W.e.f.
1	Union Bank of India	5.50%	6.00%	3 years to less than 5 years	09.07.2021
2	Canara Bank	5.50%	6.00%	3 years and up to 5 years	08.02.2021
3	State Bank of India	5.30%	5.80%	3 years to less than 5 years	08.01.2021
4	Punjab & Sind Bank	5.30%	5.80%	3 Years - 5 Years	16.05.2021
5	Bank of Baroda	5.25%	5.75%	3 years and up to 5 years	16.11.2020
6	Punjab National Bank	5.25%	5.75%	above 3 year & upto 5 years	01.05.2021
7	IDBI Bank	5.25%	5.75%	5 years	July 14, 2021
8	Indian Overseas Bank	5.20%	5.70%	3 Years and Above	09.11.2020
9	Indian Bank	5.15%	5.65%	5 years	05.02.2021
10	Central Bank of India	5.00%	5.50%	2 years and up to 10 years	10.07.2021
Source: Bank Websites