Fixed deposits (FDs) remain a crucial aspect of financial planning in India. They offer safe and predictable returns on your investment, making them ideal for risk-averse individuals seeking guaranteed income growth.
Here’s a look at three banks – Ujjivan Small Finance Bank, AU Small Finance Bank, and YES BANK – that offer FD interest rates of up to 9.00% p.a.
| Bank | Maximum FD Interest Rate |
| Ujjivan Small Finance Bank | Up to 9.00% p.a. |
| AU Small Finance Bank | Up to 8.50% p.a. |
| YES BANK | Up to 8.25% p.a. |
Disclaimer: The above-mentioned rates are as of 15th April 2024 and are subject to change at the issuers’ discretion.
Ujjivan Small Finance Bank
Ujjivan Small Finance Bank offers one of the highest FD rates in India. This makes it a compelling choice for investors seeking to maximise their returns. Here’s a deeper dive into Ujjivan Small Finance Bank’s FD offerings:
- Competitive Interest Rates: Ujjivan Small Finance Bank offers interest rates up to 9.00% p.a. This ensures that investors earn better stable returns, compared to other FD options.
- Flexible Tenor Options: You can select from a wide range of FD tenor options, ranging from 7 days to 10 years. This allows you to decide on an investment duration that aligns perfectly with your financial goals.
- Senior Citizen Benefits: The bank offers additional interest rate benefits of 0.50%, making FDs even more attractive for them.
AU Small Finance Bank
Here are some key features that set AU Small Finance Bank’s FD schemes apart:
- Competitive Interest Rates: AU Small Finance Bank is known for its competitive interest rates, with FDs offering up to 8.50% p.a.
- 24/7 Accessibility: The bank’s digital platform allows you to access your FD account and manage your investment anytime, anywhere. You can invest in FDs, track your progress, or make inquiries at your convenience online. For the same, you can make use of the AU 0101 mobile application.
- Tailored Investment Solutions: You can choose from a diverse range of FD schemes to cater to individual needs. These include callable, non-callable, and retail monthly payout fixed deposits, among others.
YES BANK
YES BANK, a well-established private sector bank, offers FD interest rates of up to 8.25% p.a. Here’s why YES BANK could be a suitable option for you:
- Transparency and Convenience: YES BANK has a user-friendly online banking platform. You can easily access important information about FD rates, terms, and manage your investments conveniently from the comfort of your home.
- Reward Points: On booking a YES Bank FD, customers are provided YES Rewardz points as part of their loyalty program
- Additional Features: It offers additional features with their FDs, such as auto-renewal, overdraft facility, and loyalty points, among others.
Important Considerations Before Investing in FDs
While FD interest rates are a crucial factor when choosing an FD scheme, they are not the only element to consider. Here are some additional points to keep in mind before making your investment decision:
- Bank’s Credibility
Conduct thorough research to ensure you invest with a reputable and well-established bank. Research the bank’s financial health and stability. Look for ratings from independent credit rating agencies. A higher credit rating signifies a lower risk of the bank defaulting on its obligations.
- Tax Implications
Interest earned on FDs is taxable as per income tax slabs in India, under the Income Tax Act, 1961. TDS on bank FD interest is also applicable if the returns exceed the threshold of ₹40,000 for the general public and ₹50,000 for senior citizens. It’s important to consult with a tax advisor to understand how these factors might impact your overall tax liability.
- Lock-in Period
Keep in mind that certain FDs, like tax-saver FDs, come with a lock-in period. This is a predetermined and mandatory duration. If you foresee a sudden need in the future for quick funds, a regular FD may be preferable. However, premature withdrawals come with their own penalties.
- Premature Withdrawal Penalty
If you withdraw your FD before the maturity date, you will likely incur a penalty. The penalty amount varies depending on the bank and the remaining tenor of the FD. Understanding the penalty structure beforehand helps you make informed decisions about your investment and potential liquidity needs.
Fixed deposits offer a safe and secure way to grow your money. Ujjivan Small Finance Bank, AU Small Finance Bank, and YES BANK are just a few of the banks offering competitive FD rates.
By checking interest rates, tenor options, bank credibility, fees, penalties, and more, you can choose an FD scheme that fits your financial goals and risk tolerance.
