Here Are Fixed Deposits That Pay Up To 8% Interest To Senior Citizens

Seniors who depend on fixed bank deposits (FD) for their monthly cash flows have had a difficult time over the past year or so due to falling interest rates. Interest rates on small savings plans have also dropped dramatically. This is because the Reserve Bank of India (RBI) has consistently lowered repurchase rates. Banks have followed the same path and have gradually reduced interest rates on fixed deposits through holdings. Still, there are some banks that offer attractive three-year DF ​​rates for seniors.

Higher rates offered by smaller private banks

Up to five private sector banks and two small financial banks offer DFs at rates above 7 percent for a three-year period. RBL Bank, IDFC First Bank, DCB Bank, IndusInd Bank and YES Bank offer 7.25-8 percent interest in their three-year DFs, according to data compiled by BankBazaar.

Investments in fixed deposits of up to Rs 5 lakh are guaranteed by the Deposit Insurance and Credit Guarantee Corporation (DICGC), a subsidiary of RBI.

The best rates on 3 year FDs for senior citizens

Bank	Annual Rate of Interest	What Rs 1 lakh grows in three years to (Rs)
RBL Bank	8.00%	126,824
IDFC First Bank	7.75%	125,895
AU Small Finance Bank	7.75%	125,895
DCB Bank	7.45%	124,788
Induslnd Bank	7.25%	124,055
Yes Bank	7.25%	124,055
Ujjivan Small Finance Bank	7.00%	123,144
Bandhan Bank	6.85%	122,600
Standard Chartered	6.50%	121,341
Karur Vysya Bank	6.35%	120,805

Data as on 22 July 2020 in respective banks website. Interest rate on three-year term deposits (for senior citizens of 60-80 years age, deposit amount below Rs 1 crore) of all listed (BSE) public & private banks and foreign banks considered for data compilation. banks for which verifiable data is not available is not considered. for all FDs, quarterly compound is assumed. minimum investment amount may vary depending on types of term deposits. Compiled by Bankbazaar.com

Axis Bank, ICICI Bank and HDFC Bank offer three-year, 5-percent, 5.85-percent and 5.70-percent respectively in DF for seniors, while the State Bank of India (SBI) and the Bank of Baroda (BOB) they pay 5.80 percent and 5.60 percent, respectively. The minimum investment amount varies from Rs 100 to Rs 20,000 for three-year fixed deposits in banks. Seniors can park a small portion of their debt portfolio in these DFs for better returns.