Senior citizens can currently secure of up to 8.50%, with small finance banks offering some of the most attractive returns in the market. Private, public sector and foreign banks are also providing competitive FD rates for elderly depositors.
For those investing substantial sums, even a marginal variation in FD rates can have a significant impact on the total interest earned. Comparing rates offered by different banks and selecting an appropriate deposit tenure can help senior citizens improve their interest income while retaining the relatively low-risk nature of fixed deposits.
FD Rates for Senior Citizens Offered by Small Finance Banks
| Bank Name | Highest slab (%) | 1-year tenure (%) | 3-years tenure (%) | 5-years tenure (%) |
|---|---|---|---|---|
| AU Small Finance Bank | 7.90 | 6.85 | 7.90 | 7.25 |
| Capital Small Finance Bank | 7.60 | 7.60 | 7.40 | 7.30 |
| Equitas Small Finance Bank | 8.50 | 7.60 | 7.60 | 7.50 |
| ESAF Small Finance Bank | 8.50 | 6.50 | 6.50 | 6.25 |
| Fincare Small Finance Bank | 7.60 | 6.85 | 7.60 | 7.25 |
| Jana Small Finance Bank | 8.30 | 7.50 | 8.30 | 7.77 |
| Shivalik Small Finance Bank | 8.50 | 6.50 | 8.00 | 6.75 |
| Suryoday Small Finance Bank | 8.50 | 7.40 | 7.40 | 8.50 |
| Ujjivan Small Finance Bank | 8.30 | 7.75 | 7.75 | 7.70 |
| Unity Small Finance Bank | 8.00 | 8.00 | 7.25 | 7.25 |
| Utkarsh Small Finance Bank | 8.25 | 6.50 | 8.00 | 7.50 |
The senior citizen mentioned above were last updated on 26 August 2026 and apply to deposits of less than ₹3 crore.
The source for the above interest rates is Paisabazaar.com.
Senior Citizen FD Interest Rates at Private Sector Banks
| Bank Name | Highest slab (%) | 1-year tenure (%) | 3-years tenure (%) | 5-years tenure (%) |
|---|---|---|---|---|
| IndusInd Bank | 7.75 | 7.25 | 7.75 | 7.15 |
| YES Bank | 7.75 | 7.15 | 7.75 | 7.50 |
| IDFC FIRST Bank | 7.50 | 6.75 | 7.50 | 7.00 |
| Karnataka Bank | 7.40 | 6.90 | 6.55 | 6.55 |
| ICICI Bank | 7.10 | 6.75 | 6.95 | 6.90 |
| HDFC Bank | 7.10 | 6.75 | 6.95 | 6.90 |
| Axis Bank | 7.25 | 6.75 | 7.00 | 7.25 |
| Bandhan Bank | 7.95 | 7.50 | 7.75 | 6.60 |
| CSB Bank | 7.35 | 5.25 | 6.00 | 6.00 |
| City Union Bank | 7.50 | 6.90 | 6.75 | 6.75 |
| DBS Bank | 7.35 | 6.80 | 6.90 | 6.75 |
| DCB Bank | 8.00 | 7.15 | 7.25 | 8.00 |
| Dhanlaxmi Bank | 7.75 | 6.75 | 7.00 | 7.00 |
| Federal Bank | 7.20 | 6.75 | 7.00 | 6.90 |
| IDBI Bank | 7.00 | 6.70 | 6.85 | 6.75 |
| J&K Bank | 7.55 | 7.05 | 7.30 | 7.35 |
| Kotak Mahindra Bank | 7.30 | 7.00 | 6.90 | 6.75 |
| Karur Vysya Bank | 7.20 | 6.95 | 6.95 | 6.95 |
| Nainital Bank | 7.10 | 6.25 | 6.75 | 6.25 |
| RBL Bank | 7.70 | 7.50 | 7.70 | 7.20 |
| SBM Bank | 8.15 | 7.60 | 8.15 | 7.50 |
| South Indian Bank | 7.30 | 6.85 | 6.70 | 6.20 |
| Tamilnad Mercantile Bank | 7.70 | 7.30 | 7.20 | 7.20 |
Note: The above-stated senior citizen FD rates are updated as of 26 Aug 2026 and are applicable to deposits below ₹3 crores.
The source for the above interest rates is Paisabazaar.com.
Senior Citizen FD Interest Rates at Public Sector Banks
| Bank Name | Highest slab (%) | 1-year tenure (%) | 3-years tenure (%) | 5-years tenure (%) |
|---|---|---|---|---|
| Bank of Baroda | 7.25 | 6.75 | 6.75 | 6.90 |
| Bank of India | 7.45 | 7.00 | 7.45 | 6.75 |
| Bank of Maharashtra | 7.15 | 6.90 | 5.75 | 5.50 |
| Canara Bank | 7.10 | 6.75 | 6.75 | 6.75 |
| Central Bank of India | 7.25 | 6.60 | 6.50 | 6.50 |
| Indian Bank | 7.15 | 6.60 | 6.55 | 6.50 |
| Indian Overseas Bank | 7.10 | 7.00 | 6.60 | 6.60 |
| Punjab National Bank | 7.10 | 6.75 | 6.80 | 6.60 |
| Punjab & Sind Bank | 7.35 | 6.35 | 6.35 | 6.45 |
| State Bank of India | 7.05 | 6.75 | 6.80 | 7.05 |
| UCO Bank | 6.95 | 6.35 | 6.50 | 6.50 |
| Union Bank of India | 7.05 | 6.70 | 6.60 | 6.50 |
Note: The above-stated senior citizen FD rates are updated as of 26 Aug 2026 and are applicable to deposits below ₹3 crores.
The source for the above interest rates is Paisabazaar.com.
FD rates and tax can change the picture
FD rates vary by bank and tenure, while senior citizens generally receive an additional interest-rate benefit. Some small finance banks offer higher rates, but retirees should also consider the bank’s financial strength, deposit tenure, premature withdrawal rules, and deposit insurance limits before locking in any fixed deposits.
Tax is another important consideration that must not be ignored when planning fixed deposit investments. Under the Income-tax Act, 2025, applicable from 1 April 2026, FD interest remains taxable. Section 92 generally brings such interest under ‘Income from other sources’.
Furthermore, senior citizens can claim a deduction of up to ₹50,000 on eligible deposit interest under Section 153, subject to applicable terms and conditions. This replaces the corresponding benefit previously available under Section 80TTB of the Income-tax Act, 1961. This deduction is not an ‘exemption’, which is why FD interest does not become completely refundable or tax-free.
TDS provisions, on the other hand, are explained in Section 393. For interest on specified deposits, banks generally deduct TDS at 10% once the applicable threshold is crossed. The threshold is ₹1 lakh for senior citizens and ₹50,000 for other individuals.
Furthermore, as a well-informed fixed-income investor, you should be aware that TDS is not the final tax liability; the actual tax depends on total income and the applicable tax regime. It can vary from one individual to another.