These Banks Are Offering Fixed Deposit (FD) Interest Rates Upto 8.50%, Should You Invest?

Fixed Deposit (FD) is an investment plan that will offer you the basic investment amount along with the given interest rate, at the end of the term.

FD Interest rates

FD is a kind of term deposit, where you need to invest the lump sum money at once. The interest rate on the FDs will depend and vary on the tenure and the investment amount. The interest rates for public and senior citizens are generally different. The banks will normally offer around 0.50% higher interest rates to the senior citizens, compared to the public. For FDs, premature closure is allowed. That means, if an investor has chosen an FD of Rs. 1 lakh for 5 years, he/she can still withdraw the money before 5 years. However, in that case, the investor will receive lesser interest on the amount.

At present, the banks are trying to give competitive interest rates. The repo rate is at a historical low now in India. Hence, the interest rates on deposits are not attracting much profit. On the other hand, interest on loans is quite affordable now. So, investors need to check and compare the FD interest rates in different banks.

1. Utkarsh Small Finance Bank

The Utkarsh Small Finance Bank is offering good FD returns, mostly for the long-term investments, compared to short terms. Like, for 91-180 Days, the bank is offering 4.00% interest for the public, and 4.50% interest for senior citizens. For 181-364 Days, it will be 5.75% interest for the public, and 6.25% for senior citizens. For 365-699 Days, it will be 6.25% interest for the public, and 6.75% for senior citizens. For 700 Days, it will be 6.75% interest for the public, and 7.25% for senior citizens. FD interest up to 1 year is better in this bank than the Mahaveer Co-operative Urban Bank Ltd. For 701-3652 Days, the interest rate will be 6.00% for the public, and 6.50% for senior citizens.

This bank, earlier commenced its journey from Varanasi as a Micro Finance Institution (MFI), with 4 branches, with a client base of 8,000, and an Outstanding Portfolio of 6.3 crores. However, with adequate performances, the MFI received the final RBI license in FY 2016-17, to start the banking operations. They had finally begun banking operations as a Small Finance Bank in 2017.

2. Mahaveer Co-operative Urban Bank Ltd.

Mahaveer Co-operative Urban Bank is offering good interest rates among all these three mentioned banks. The interest in this bank, for 2-5 years FDs, the interest rate is one of the best in the industry. For 30-180 Days, the bank is offering 4.00% interest for the public, and 4.50% interest for senior citizens. For 181 days-1 year, it will be 4.50% interest for the public, and 5.00% for senior citizens. For above 1 year-2 years, it will be 7.50% interest for the public, and 8.00% for senior citizens. For above 2 year-5 years, it will be 8.00% interest for the public, and 8.50% for senior citizens. This rate is the highest-paid interest in the bank. However, this bank will provide a 7.75% interest rate on FDs for above 5 years for the public, and 8.25% for senior citizens. If an investor wants to withdraw the money before maturity, the interest rate will be reduced by 2%.

Mahaveer Co-operative Urban Bank Ltd. was registered as a Co-operative Society and was granted registration. The RBI granted the application of the society for the license as Co-operative Bank in 1999. the bank's first branch was opened in Hyderabad. As it is an RBI licensed bank, it will be safe to keep your money in the bank.

3. Suryoday Small Finance Bank

This bank has a better reach than the previously mentioned bank. For 91 days-6 months, Suryoday Small Finance Bank is offering 4.75% interest for both public and senior citizens. For Above 9 months to less than 1 Year, it will be 5.75% interest for both public, and senior citizens. For 1 year-2 years, it will be 6.50% interest for the public, and 6.75% for senior citizens. For above 2 years-less than 3 years, it will be 6.25% interest for the public, and 6.50% for senior citizens. For 3 years FD, it will be 7.00% interest for the public, and 7.30% for senior citizens. Additionally, for above 3 year-less than 5 years FDs, the bank will fetch a 6.50% interest rate for public, and senior citizens. Suryoday Small Finance Bank is offering a 6.00% interest rate for both public and senior citizens for above 5 years to 10 years FDs.

It is a very popular small finance bank in the country. Suryoday Small Finance Bank, became a Small Finance Bank from a Micro Finance within only 8 years. Now the bank has around 1.4 million customers. This bank has received the license for 'Small Finance Bank', from RBI. Suryoday Small Finance Bank started operating in January 2017 with an endeavor to bring banking solutions to the ‘banked', ‘under-banked' and the ‘un-banked' sections of the society. This bank's FD rates are also lucrative among the small finance banks in India.

(Also read: Best Fixed Deposit (FD) Rates Of These Private Banks Offering Upto 7.05% Interest: Latest Details)