Before opening a fixed deposit (FD) account with a bank, it is better to compare the interest rates offered by different lenders. Higher the interest offered, greater the income for the depositor. Someone who deposits ₹5 lakh in a fixed deposit (FD), an extra 50 basis point interest offered on it leads to an extra income of ₹7,500 over a three-year period. And when this amount is ₹10 lakh, the extra income jumps to ₹15,000.
Here, we compare the highest interest rates offered by top private sector banks after the latest revisions. Notably, most banks revised their interest rates downward in the past couple of weeks after RBI cut repo rate in its second consecutive monetary policy committee (MPC) meet.
HDFC Bank
The largest private sector bank 6.6 percent on its one-year fixed deposit, 6.7 percent on its two-year FD and 6.9 percent on its three-year fixed deposit (FD). Senior citizens are entitled to receive an extra 50 basis points on these rates. These rates came into force on April 19, 2025.
ICICI Bank
This private sector bank offers 7.05 percent as highest interest on two-year fixed deposit. On one-year term deposit, the private sector bank offers 6.7 percent interest to general citizens and 7.2 percent to senior citizens. The corresponding rates on three year deposits are 6.9 percent and 7.4 percent, respectively.
Kotak Mahindra Bank
This private bank offers above 7.1 percent on its one-year fixed deposit to general citizens and 7.6 percent to senior citizens. The corresponding interest rates on two-year deposits are 7.15 percent and 7.65 percent, respectively. On three-year FDs, the corresponding interest rates are 7 percent and 7.5 percent, respectively. These rates came into effect on April 9, 2025.
Federal Bank
This private sector bank offers 6.85 percent to general depositors on one-year fixed deposits and 7.35 percent to senior citizens. the corresponding interest rates on two year and three year fixed deposits are 7 percent and 7.5 percent, respectively. These rates came into force on April 17, 2025.
However, it is important to note that the interest income on fixed deposits is taxable. So, those investors who fall in the high tax bracket are recommended to invest only a small portio of their savings in an FD.
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