When it comes to investment 'Fixed Deposits' are one of the popular products among investors. Even though returns are low, when compared to equity markets Fixed Deposits are risk-free zones for regular returns. Public sector banks pay 4% interest and private sector banks pay 6% over deposits accumulated in a savings account for every quarter. FD rates of banks changes with RBI Repo rates. Banks offer various FD schemes with a maturity period ranging from 7 days to 10 years with different interest rates.
Important things the customer needs to know before depositing.
Senior citizens will be offered higher interest rates by banks. Interest payment will be of 2 types cumulative and non-cumulative, you can choose either of these 2 options. In Non-Cumulative option, interest will be paid in monthly, quarterly, half-yearly or annual basis depends on banks, whereas cumulative will give one-time amount along with principle amount at the time of maturity.
Interest earned on FD is taxable. If the interest exceeds Rs 10,000 in a single financial year, the bank will deduct TDS from payable interest. Depositor needs to submit Form 15G or 15H to avoid TDS.
A penalty will be imposed by banks for Premature with drawls and it varies from bank to bank.
The depositor can avail loan on FD, and its limit depends on the principal amount of deposit.
Most of the banks will automatically renew your deposit plan if you forget to claim your matured deposit. So do not opt for an automatically renew option at the time of deposit opening form.
Here are some top banks with the latest Fixed deposit rates.
SBI pays 6.4 per cent interest for your deposits with maturity from 7 days to 1 year. On fixed deposits maturing between 1 year to 2 years, the bank will pay 7% interest. It offers 6.75% interest on FDs maturing between two and three years. On FDs maturing between 3 to 5 years, SBI offers 6.70% interest rate. Bank will pay 6.60% interest on Fixed deposits maturing between 5 to 10 years.
Bandhan Bank (BB) offers the highest interest rate on long-term fixed deposits. Bank offers 7.65% interest on FD maturing from 2 to 10 years. On FDs maturing in 7 days to 14 days, the bank offers 3.5% interest. Bank will pay 4% interest on term deposits maturing in 15 days to less than three months. On term deposits maturing from 3 months up to 6 months, the bank will pay 4.50% interest. The bank is offering interest of 7.35% on deposits with tenure of 6 to 18 months. For one and half year to less than 2 years, 7.50% of interest will be offered by Bandhan bank.
HDFC Bank is offering various tenures and interest rates ranging from 3.50% to 7.30% on FDs. On FDs with a term period of 7 to 45 days, Bank is offering an interest rate of 5.50%. For deposits maturing in 46 days to 6 months, the bank offers 6 per cent of interest and for FD of 1-year maturity, the bank offers 7.10% interest. Term deposits maturing in 1 year to 2 years, the bank is offering 7.20% interest. Bank will pay 7.30% interest on deposits with maturity term from 2 to 3 years. 7.25% and 7% of interest will be paid for long-term deposits with tenure of 3 to 5 years and 5 to 10 years respectively.
Bank of Baroda (BOB) announced new interest rates on its term deposits. It offers 4.75% interest on Fixed deposits with a term period of 7 to 90 days. On deposits with a maturity term of 91 to less than 1 year, the bank offers 6.25% interest. For 1-year term deposits, BOB offers 6.45% interest. The bank is offering 6.55% for a term deposit of 1 to 2 years. Term deposits maturing in 2 to 5 years and 5 to 10 years, the bank will pay 6.45% interest.
Non-Banking Financial Company Bajaj Finance offering 8.60% interest for general customers and senior citizens are availed with 0.35% more on the basic interest rate.
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