Best FD Interest Rates in 2020

Fixed Deposits remain one of the most popular investment instruments in India, largely due to low risk and guaranteed returns. Most Savings Accounts offer interest at 3.5 – 4% p.a. whereas Fixed Deposits can provide an interest of up to 9.00% p.a. Hence, those with idle cash in their bank accounts can invest in fixed deposits to earn higher returns.

Here is everything you need to know about the best fixed deposit schemes available for Indian citizens in 2020.

Best FD Interest Rates – April 2020

Note – Fixed Deposit Rates are subject to change without any prior information.

As can be seen, currently small finance banks are offering higher interest rates than commercial banks. While some customers may be more comfortable with commercial banks than small finance banks, they should note that, like commercial banks, depositors in Small Finance Banks are also covered under the depositor insurance program of Deposit Insurance and Credit Guarantee Corporation (DICGC). This means that bank deposits of up to Rs. 1 lakh, including fixed, savings, current and recurring deposits, per depositor per bank, are covered by insurance, in the event of bank failure for small finance banks as well as commercial banks. The depositors are covered for the same amount with both small finance banks and commercial banks; hence, the risk of investing in a fixed deposit remains the same for both.

We would, therefore, recommend customers to choose a fixed deposit that offers the highest interest rate, whether it’s from a commercial bank or a small finance bank.

Highest Bank FD Rates for Top Banks

Note: Fixed Deposit Rates are subject to change without any prior information.
* – FD interest rates across tenures for each bank are mentioned further in the article.  

Highest FD Interest Rates for Small Finance Banks

*Fixed Deposit Rates are subject to change without any prior information.
** – FD interest rates across tenures for each small finance bank ate mentioned further in the article.

How to Choose the Best Fixed Deposit Scheme?

Following are some important aspects that every FD investor should consider to maximize returns while investing in a fixed deposit:

1. FD Rate – The rate of interest for a specific tenure is of primary importance for depositors. Several banks provide high FD interest rates for different tenure options. To choose the best FD scheme available (on the basis of high FD interest rate & tenure that you want to stay invested), you should first have a specific financial goal in mind.

Once you have decided on a certain financial goal, you should look for a bank providing the best FD interest rate in the tenure you can stay invested in.

2. Tenure – As mentioned above, the time for which you can deposit your money is an important aspect, while choosing the best fixed deposit. Banks provide fixed deposits for tenure ranging from 7 days to 10 years. You should always invest in a fixed deposit and select deposit tenure depending upon your financial goal.

Another thing that you can consider while choosing the deposit tenure is the interest rate regime. If you think in the future there will be a rising interest rate regime (i.e. interest rates will rise in the future), then you should go for a shorter FD tenure. And, in case of a falling interest rate regime (i.e. interest rates will decrease in the future), you should invest your hard-earned money for a longer period of time.

3. Credibility – There are a number of banks that provide higher FD interest rates but might indicate some risk. It is always advisable to make deposits in scheduled banks and NBFCs that are certified by ICRA, CRISIL, etc.

Also, if you want to invest in Corporate Fixed Deposits, you should consider company funds based on the credit ratings on deposits provided. Company Deposits with high credit ratings (for instance: FAAA, FAA) are considered safe. These ratings indicate a degree of safety regarding the timely payment of deposit amount (principal) and interest.

4. FD Calculator – Use a fixed deposit calculator to check and compare FD rates by various banks and the maturity amount you will get on investing. An FD calculator is an online tool that takes values like deposit amount, tenure (in years/ days/ months) and related fixed deposit rate to give users an estimate of maturity amount. In this way, users can plan their investment wisely as they have an estimate of returns.

5. Payout – The payout option provided by your bank also plays an important role while selecting the best fixed deposit scheme. Banks provide 2 types of fixed deposits in India – Cumulative and Non-Cumulative Fixed Deposits.

Under a Cumulative FD Scheme, you will not be paid interest over quarterly, half-yearly or yearly. FD interest under this scheme will be compounded every quarter, half-year or year and will be added back to your principal amount, which will be paid at the end of the deposit tenure.

Under a Non-Cumulative FD Scheme, you will be paid every quarter, half-year or year depending upon the payout option you opt for. This FD scheme is best suited for senior citizens, widows who want regular cash inflows. Regular investors can opt for cumulative FDs for the compounding interest rates.

Tax on Fixed Deposits

Unlike savings accounts that offer lower interest rates, fixed deposits are fully taxable. Below mentioned are some important aspects related to taxation on FDs:

• Tax Deducted at Source (TDS) on fixed deposits at a rate of 10%
• In case a depositor has not submitted his PAN, he is taxed at 20%
• In case the bank has deducted tax at a rate of 10% but you fall in a higher tax bracket, you have to pay the additional tax
• You should check Form 26AS while filing your returns to know the TDS deducted by the bank on your FDs. You can then pay any additional amount due or claim a refund as the case may be

Highest Fixed Deposit Interest Rates for Top Banks Across Tenure

IndusInd Bank FD Rates

FD interest rates in IndusInd Bank are as follows:

Note: Interest rates mentioned above are applicable on deposits below Rs. 2 crore with effect from 2^nd January 2020.

DCB Bank FD Rates

FD rates in DCB Bank are as follows:

Note: Interest rates mentioned above are applicable on deposits below Rs. 2 crore with effect from 2^nd January, 2020.

Kotak Bank FD Rates

FD rates in Kotak Mahindra Bank are as follows:

Note: Interest rates mentioned above are applicable on deposits below ₹ 2 crore with effect from 13th Feb, 2020.

Yes Bank FD Rates

FD rates in Yes Bank are as follows:

Note: Interest rates for deposits < Rs. 2 crore, w.e.f. 25th October 2019.

ICICI Bank FD Rates

FD rates in ICICI Bank are as follows:

Note: Interest rates are applicable on deposits below ₹ 2 crore with effect from 7th December, 2019.

HDFC Bank FD Rates

FD rates in HDFC Bank are as follows:

Note: Interest rates are applicable on deposits below Rs. 2 crore with effect from 18^th March 2020.

SBI FD Rates

FD rates by the State Bank of India are as follows:

Note: The above-stated SBI FD interest rates are applicable on deposits below Rs. 2 crores with effect from 28^th March 2020.

Bank of Baroda FD Rates

FD rates in Bank of Baroda are as follows:

Note: Above interest rates are applicable on deposits below Rs. 2 Cr. w.e.f. 10th February, 2020.

RBL Bank FD Rates

FD rates in RBL Bank are as follows:

Note: Interest rates are applicable on deposits below ₹ 2 crore with effect from 16th January 2020. 

Axis Bank FD Rates

FD rates in Axis Bank are as follows:

Note: The above mentioned Axis Bank FD Rates are applicable with effect from 9th January, 2020.

DBS Bank FD Rates

FD rates in DBS Bank are as follows:

Note: Figures mentioned in the above table are applicable with effect from 10th December 2019. Interest rates are for deposits below Rs. 2 crore.

IDFC First Bank FD Rates

FD rates in IDFC Bank are as follows:

Note: Interest rates are applicable on deposits below ₹ 2 crore with effect from 1^st January, 2020.

Bandhan Bank FD Rates

FD interest rates in Bandhan Bank are as follows:

Note: Interest rates are applicable on deposits below ₹ 2 crore with effect from 13th February 2020.

Canara Bank FD Rates

FD interest rates in Canara Bank are as follows:

Note: Interest rates are applicable on deposits below ₹ 2 crore with effect from 18th November 2019.

Federal Bank FD Rates

FD interest rates in Federal Bank are as follows:

Note: The above-mentioned interest rates are applicable to deposits below ₹ 2 crore with effect from 13th December, 2019.

OBC FD Rates

FD interest rates in Oriental Bank of Commerce are as follows:

Note: The above-mentioned interest rates are applicable to deposits below ₹ 2 crore with effect from 22nd November, 2019.

Lakshmi Vilas Bank Fixed Deposit Interest Rates

Best Fixed Deposit Interest Rates for Small Finance Banks in Detail

ESAF Small Finance Bank Fixed Deposit Rate

FD interest rates in ESAF Small Finance Bank are as follows:

Note: Interest rate are applicable on deposits below ₹ 2 crore with effect from 01st December, 2019

Suryoday Small Finance Bank Fixed Deposit Rate

FD interest rates in Suryoday Small Finance Bank are as follows:

Note: Interest rates are applicable on deposits below ₹ 2 crore with effect from 1^st December, 2019

Utkarsh Small Finance Bank Fixed Deposit Rate

FD interest rates in Utkarsh Small Finance Bank are as follows:

Note: Interest rates are applicable on deposits below ₹ 2 crore with effect from 15th February 2020.

Jana Small Finance Bank Fixed Deposit Rate

FD interest rates in Jana Small Finance Bank are as follows:

Note: Interest rates are applicable on deposits below ₹ 2 crore with effect from 3rd March 2020.

Equitas Small Finance Bank Fixed Deposit Rate

FD interest rates in Equitas Small Finance Bank are as follows:

Note: Interest rate are applicable on deposits below ₹ 2 crore with effect from 2nd December, 2019.

Fincare Small Finance Bank Fixed Deposit Rate

FD interest rates in Fincare Small Finance Bank are as follows:

Note: Interest rates are applicable on deposits below ₹ 2 crore effective from 2nd March 2020.