In an environment of persistent inflation and evolving interest rates, investors are increasingly looking for stable, predictable income options that protect capital while delivering regular returns. In 2026, small finance banks (SFBs) in India continue to offer some of the most competitive fixed deposit (FD) rates in the banking system, making them an attractive choice for conservative investors, retirees, and senior citizens.
Furthermore, a ₹1 crore FD in these banks can generate an estimated monthly income of ₹60,000 to ₹69,000, depending on the bank, tenure, and applicable interest rate.
Let us look at the interest rates offered by for both general and senior citizens and see how they can go a long way toward assisting with wealth conservation and creation.
Small finance bank FD rates for general citizens
|
Bank Name |
Highest Slab (%) |
Tenure |
1-Year (%) |
3-Year (%) |
5-Year (%) |
10-Year (%) |
|---|---|---|---|---|---|---|
| AU Small Finance Bank | 7.25 | 30 months 1 day to 36 months | 6.35 | 7.25 | 6.75 | 6.75 |
| Equitas Small Finance Bank | 7.40 | 888 days | 6.90 | 7.00 | 7.00 | 7.00 |
| ESAF Small Finance Bank | 7.75 | 2 years to less than 3 years | 4.75 | 6.00 | 5.75 | 5.75 |
| Jana Small Finance Bank | 7.77 | Above 3 years to 5 years | 7.00 | 7.50 | 7.77 | 6.50 |
| Shivalik Small Finance Bank | 7.80 | 21 months 1 day to 22 months | 6.00 | 6.75 | 6.25 | 6.25 |
| slice Small Finance Bank | 7.75 | 18 months 1 day to 18 months 2 days | 6.25 | 7.50 | 7.00 | 6.50 |
| Suryoday Small Finance Bank | 8.10 | 30 months | 7.25 | 7.25 | 7.90 | 7.25 |
| Ujjivan Small Finance Bank | 7.45 | 2 years | 7.25 | 7.20 | 7.20 | 6.50 |
| Utkarsh Small Finance Bank | 8.10 | 666 days | 6.00 | 7.50 | 7.00 | 6.75 |
Note: Interest rates as of 13 May 2026. For updated terms and conditions, refer to the official website of the respective lending institutions. Source: Paisabazaar
Senior citizen FD rates in small finance banks
|
Bank Name |
Highest Slab (%) |
Tenure |
1-Year (%) |
3-Year (%) |
5-Year (%) |
10-Year (%) |
|---|---|---|---|---|---|---|
| AU Small Finance Bank | 7.75 | 30 months 1 day to 36 months | 6.85 | 7.75 | 7.25 | 7.25 |
| Equitas Small Finance Bank | 8.00 | 888 days | 7.40 | 7.50 | 7.50 | 7.50 |
| ESAF Small Finance Bank | 8.25 | 2 years to less than 3 years | 5.25 | 6.50 | 6.25 | 6.25 |
| Jana Small Finance Bank | 8.00 | Above 1 year to 3 years | 7.50 | 8.00 | 7.77 | 7.00 |
| Shivalik Small Finance Bank | 8.30 | 21 months 1 day to 22 months | 6.50 | 7.25 | 6.75 | 6.75 |
| slice Small Finance Bank | 7.75 | 18 months 1 day to 18 months 2 days | 6.50 | 7.50 | 7.25 | 6.75 |
| Suryoday Small Finance Bank | 8.25 | 30 months | 7.40 | 7.40 | 8.05 | 7.40 |
| Ujjivan Small Finance Bank | 7.95 | 2 years | 7.75 | 7.70 | 7.70 | 7.00 |
| Utkarsh Small Finance Bank | 8.25 | 666 days | 6.50 | 8.00 | 7.50 | 7.25 |
Note: Interest rates as of 13 May 2026. For updated terms and conditions, refer to the official website of the respective lending institutions. Source: Paisabazaar
Monthly income on ₹1 crore FD
The monthly payout from a non-cumulative FD is calculated as:
Monthly income = (Principal × Annual interest rate) ÷ (12 × 100)
General citizens
|
Bank |
Highest FD Rate |
Approx Monthly Income |
|---|---|---|
| AU Small Finance Bank | 7.25% | ₹60,417 |
| Equitas Small Finance Bank | 7.40% | ₹61,667 |
| ESAF Small Finance Bank | 7.75% | ₹64,583 |
| Jana Small Finance Bank | 7.77% | ₹64,750 |
| Shivalik Small Finance Bank | 7.80% | ₹65,000 |
| slice Small Finance Bank | 7.75% | ₹64,583 |
| Suryoday Small Finance Bank | 8.10% | ₹67,500 |
| Ujjivan Small Finance Bank | 7.45% | ₹62,083 |
| Utkarsh Small Finance Bank | 8.10% | ₹67,500 |
Senior citizens
|
Bank |
Highest FD Rate |
Approx Monthly Income |
|---|---|---|
| AU Small Finance Bank | 7.75% | ₹64,583 |
| Equitas Small Finance Bank | 8.00% | ₹66,667 |
| ESAF Small Finance Bank | 8.25% | ₹68,750 |
| Jana Small Finance Bank | 8.00% | ₹66,667 |
| Shivalik Small Finance Bank | 8.30% | ₹69,167 |
| slice Small Finance Bank | 7.75% | ₹64,583 |
| Suryoday Small Finance Bank | 8.25% | ₹68,750 |
| Ujjivan Small Finance Bank | 7.95% | ₹66,250 |
| Utkarsh Small Finance Bank | 8.25% | ₹68,750 |
Key takeaways
- Suryoday Small Finance Bank and Utkarsh Small Finance Bank currently offer lucrative regular FD rates at 8.10%.
- Shivalik Small Finance Bank offers the highest senior-citizen FD rate of 8.30%.
- A ₹1 crore FD can hence generate monthly income between ₹60,000 and ₹69,000, depending on the investor category and tenure.
- generally receive an additional 0.25%–0.50% over regular depositors.
Significance of tax implications
Investors should also remember that FD interest is taxable as per their income tax slab, and deposits are insured up to ₹5 lakh under the Deposit Insurance and Credit Guarantee Corporation (DICGC) norms. Before locking in your funds, you should conduct thorough due diligence, understand at a fundamental level, discuss the issue with certified financial advisors, and proceed only after doing so.
Small finance banks are offering attractive FD rates in May 2026, making them a strong option for investors seeking stable monthly income. Still, investment decisions should not be made solely on the basis of the offered interest rates. Higher returns should always be balanced against factors such as diversification, liquidity needs, the effectiveness of these investments in the face of , tax implications, and bank safety.
You can also acquire knowledge on other asset classes, such as ULIPs, bonds, equities, , Silver ETFs, and similar asset classes, by reading good books on personal finance and investment, and taking guidance from certified financial planners, before making investments in any particular asset class.
For all personal finance updates, visit .