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Higher than SCSS: 14 banks offering fixed deposits with over 8.2% interest rate for senior citizens
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5 min read | Updated on February 26, 2025, 18:11 IST
SUMMARY
The change in repo rate cut is expected to impact fixed deposit interest rates, which is particularly significant for senior citizens who rely heavily on bank deposits to finance their post-retirement lives. It is anticipated that banks will soon follow the RBI by lowering their fixed deposit interest rates.
Several small banks have revised their fixed deposit interest rates. | Image source: Shutterstock
The recent repo rate cut announcement by the Reserve Bank of India (RBI) has put the spotlight on time deposits or fixed deposits. For the first time in five years, the RBI has lowered the repo rate by 0.25% to 6.25%.
The change in repo rate cut is expected to impact fixed deposit interest rates, which is particularly significant for senior citizens who rely heavily on bank deposits to finance their post-retirement lives.
It is anticipated that banks will soon follow the RBI by lowering their fixed deposit interest rates. However, banks may face a dilemma as they also aim to increase their deposit ratios.
As of now, most large banks like SBI and HDFC Bank have kept their fixed deposit interest rates unchanged.
Despite this, many banks are currently offering fixed deposit plans with higher interest rates than the Senior Citizen Savings Scheme (SCSS). Currently, the SCSS scheme is offering 8.2% interest to senior citizens.
The following is a list of 14 banks offering over 8.2% interest rate on fixed deposits and their respective tenures.
| Sr No | Bank | FD interest rate | Tenure |
|---|---|---|---|
| 1 | Ujjivan Small Finance Bank | 8.75% | 18 months |
| 2 | Ujjivan Small Finance Bank | 8.6% | 12 months to < 18 months |
| 3 | Ujjivan Small Finance Bank | 8.25% | 18 months 1 day to 990 days |
| 4 | DCB Bank | 8.55% | 19 months to 20 months |
| 5 | DCB Bank | 8.35% | 37 months to 38 months |
| 6 | DCB Bank | 8.25% | More than 12 months to 12 month 10 days |
| 7 | Suryoday Small Finance Bank | 8.75% | 1 year to 3 years |
| 8 | Suryoday Small Finance Bank | 9.1% | 5 years |
| 9 | Shivalik Small Finance Bank | 9.05% | 12 months 1 day to less than 18 months |
| 10 | Shivalik Small Finance Bank | 8.8% | 18 months to 24 months |
| 11 | North East Small Finance Bank | 8.75% | 12 months 1 day to 18 months |
| 12 | North East Small Finance Bank | 9.00% | 18 months 1 day to 36 months |
| 13 | North East Small Finance Bank | 8.50% | 36 months 1 day to 60 months |
| 14 | ESAF Small Finance Bank | 8.5% | 2 years to 887 days; 889 days to less than 3 years |
| 15 | ESAF Small Finance Bank | 8.88% | 888 days |
| 16 | ESAF Small Finance Bank | 8.25% | 1 year 1 day to less than 2 years |
| 17 | Unity Small Finance Bank | 9.50% | 1001 days |
| 18 | Unity Small Finance Bank | 8.75% | > 6 Months - 201 Days |
| 19 | Unity Small Finance Bank | 8.35% | 1 year to 500 days; 502 days to 18 months |
| 20 | Unity Small Finance Bank | 9.00% | 501 days; 701 days |
| 21 | Unity Small Finance Bank | 8.4% | > 18 Months - 700 Days |
| 22 | Unity Small Finance Bank | 8.65% | 1002 Days - 3 Year; > 3 Year - 5 Year |
| 23 | Utkarsh Small Finance Bank | 8.6% | 365 days to 699 days |
| 24 | Utkarsh Small Finance Bank | 8.85% | 700 days to less than 2 years; Above 3 Years to less than 4 Years |
| 25 | Utkarsh Small Finance Bank | 9.1% | 2 Years (730 Days) to 3 Years (1095 Days); 1500 Days |
| 26 | Utkarsh Small Finance Bank | 8.35% | 4 Years (1461 Days) up to 1499 Days; 1501 Days up to 5 Years |
| 27 | Bandhan Bank | 8.55% | 1 Year |
| 28 | Bandhan Bank | 8.50% | 1 year 1 day to 1 year 9 months |
| 29 | RBL Bank | 8.5% | 500 days |
| 30 | RBL Bank | 8.3% | 453 days to 499 days; 501 days to 545 days; 546 days to 24 months |
| 31 | SBM Bank | 8.75% | > 18 months to < 2 years 3 days |
| 32 | Yes Bank | 8.5% | 18 months |
| 33 | Yes Bank | 8.25% | 1 year; 1 year 1 day to < 18 months; 18 months 1 day to < 24 months |
| 34 | AU Small Finance Bank | 8.6% | 18 months |
| 35 | AU Small Finance Bank | 8.25% | 18 Months 1 Day to 24 Months |
| 36 | AU Small Finance Bank | 8.35% | 12 Months 1 Day to 15 Months |
| 37 | Capital Small Finance Bank | 8.5% | 1 year |
| 38 | Capital Small Finance Bank | 8.25% | 400 days |
Source: Respective bank websites, data as on February 26, 2025
Please note that the above table is for informational purposes only.
SCSS has several advantages over bank fixed deposits. SCSS allows tax deduction benefit under section 80C, subject to a limit of ₹1.5 lakh in a financial year. In FDs, only 5-year deposits are eligible for tax deduction.
Moreover, SCSS is also considered a safer savings option compared to FDs. This is because FDs come with a deposit insurance guarantee of only ₹5 lakh, whereas SCSS deposits benefit from a complete sovereign guarantee.
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