In a climate of shifting monetary policies, speculation is mounting regarding the future of high Fixed Deposit (FD) rates in India. As per media reports, analysts suggest that the Reserve Bank of India (RBI) may consider a rate cut by December 2024, following recent actions by the US Federal Reserve, which slashed interest rates by 0.50 per cent last month. This trend of easing monetary policy is prompting other central banks worldwide to contemplate similar reductions, raising expectations that the RBI may follow suit.
The potential for a lower repo rate from the RBI could significantly impact fixed deposit rates across the country. For nearly two years, investors in fixed deposits have enjoyed attractive interest rates offered by various banks and Non-Banking Financial Companies (NBFCs). However, if the RBI decides to cut rates, it is likely that FD rates will also decrease, which could diminish the returns for investors.
It is being said that the response of the RBI to the rate cuts initiated by global central banks will be critical. Market participants are keenly observing the RBI’s next moves, as a reduction in the repo rate could lead to a re-evaluation of investment strategies among Fixed Deposit holders. Meanwhile, for those looking to maximize their returns before any potential rate cuts, here's a list of the top 10 small finance banks currently offering the highest interest rates on Fixed Deposits for both general customers and senior citizens.
List of banks offering maximum interest on FDs
| Banks |
FD interest for general public |
FD interest for senior citizens |
Tenure of FD |
| Unity Small Finance Bank |
9 per cent |
9.5 per cent |
1001 days |
| North East Small Finance Bank |
9 per cent |
9.5 per cent |
1111 days |
| Suryoday Small Finance Bank |
8.65 per cent |
9.15 per cent |
2-year 2-day |
| Shivalik Small Finance Bank |
8.55 per cent |
9.15 per cent |
18-24 months |
| Utkarsh Small Finance Bank |
8.05 per cent |
9.10 per cent |
2 to 3 years |
| Jana Small Finance Bank |
8.25 per cent |
8. 75 per cent |
1 to 3 years |
| ESAF Small Finance Bank |
8.25 per cent |
8.75 per cent |
2 to 3 years |
| Ujjivan Small Finance Bank |
8.25 per cent |
8.75 per cent |
1 year |
| Equitas Small Finance Bank |
8.05 per cent |
9 per cent |
444 days |
| SBM Bank |
8.25 per cent |
8.75 per cent |
3 years |
About Fixed Deposit
A Fixed Deposit account is an investment where an individual deposits money for a predetermined period, with the interest rate remaining constant throughout the term agreed upon at account opening. Many banks enhance returns by offering an additional 0.5 per cent interest specifically for senior citizens, compared to regular customers. Furthermore, banks often provide the option to secure a collateral-free loan against FDs. Typically, the loan amount available is up to 75 per cent of the FD value, offering investors added liquidity. This arrangement allows individuals to invest in Fixed Deposits with confidence, knowing their returns are secure and they have access to funds if needed.
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