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FD interest rates are the yearly rates a bank promises on a fixed deposit, and each bank sets its own card by tenure, so the rate you get depends on the bank, how long you lock the money, the amount, and whether you are a senior citizen. Whatever rate applies when you open the deposit stays fixed until maturity, even if the bank changes its card the next week.
This hub explains what moves those rates, shows how much interest common amounts earn per month, compares bank deposits with the post office time deposit, and covers tax. We do not list any bank's rate here, because each bank revises its card often. Always read the current card on the bank's own site or at the branch.
At a glance
Who sets the rate
Each bank, within RBI rulesTypical tenures
7 days to 10 yearsDeposit insurance
DICGC insures 5 lakh for each depositor in each bankPost office option
Time deposit at 6.9% to 7.5%Tax
Interest added to income; TDS above the thresholdRegulator
What decides FD interest rates at a bank
Four things move the rate of interest on FD money. First is the RBI policy repo rate: when the RBI raises it, banks usually raise deposit rates after some weeks, and when it cuts, deposit rates drift down. Second is how much new money the bank needs; a bank short of deposits pays more. Third is tenure: banks price each time bucket separately. Fourth is size: deposits of 3 crore and above count as bulk deposits for most commercial banks and carry a separate, negotiated rate.
Bank type also matters. Public sector banks and large private banks usually pay a little less than small finance banks, which pay more to attract savers. Cooperative banks set their own cards too. A higher rate is not a sign of a bad bank, but check that the bank is covered by deposit insurance and keep each bank's total within the cover if safety is your main concern.
How rates change with tenure and age
- Very short deposits of 7 to 45 days pay the lowest rates on almost every card.
- One to three years is where most large banks put their best rates, often with one special tenure such as 444 days or 555 days.
- Five to ten years often pays a little less than the middle buckets, because banks do not want to promise a high rate for so long.
- Senior citizens usually get an extra amount, commonly about half a percentage point, on deposits below the bulk limit. See senior citizen FD rates.
Because the shape of the card differs from bank to bank, compare the exact tenure you want, not the headline rate. Our page on the highest FD rates explains how to read a rate card without naming banks.
FD interest per month on common amounts
Many people want a monthly payout from a deposit. Banks offer a monthly interest option, and the monthly figure is slightly lower than the yearly rate divided by twelve because the bank pays you earlier. The table uses round rates of 6% and 7% a year as examples only. They are not any bank's offer.
| Deposit | Monthly interest at 6% | Monthly interest at 7% |
|---|---|---|
| 1 lakh | about 500 rupees | about 583 rupees |
| 5 lakh | about 2,500 rupees | about 2,917 rupees |
| 10 lakh | about 5,000 rupees | about 5,833 rupees |
| 20 lakh | about 10,000 rupees | about 11,667 rupees |
| 50 lakh | about 25,000 rupees | about 29,167 rupees |
| 1 crore | about 50,000 rupees | about 58,333 rupees |
So the answer to 10 lakh FD interest per month is roughly 5,000 to 5,800 rupees at those example rates, and 1 cr FD interest per month is roughly 50,000 to 58,000 rupees, before tax. For 50 lakh FD interest per month, halve the 1 crore figure. Use the FD calculator with your bank's real rate for an exact number.
Bank FD or post office time deposit
| Point | Bank FD | Post office time deposit |
|---|---|---|
| Rate | Set by each bank, changes often | Set by the government each quarter: 6.9% for 1 year, 7% for 2, 7.1% for 3, 7.5% for 5 |
| Tenures | 7 days to 10 years | Fixed menu of 1, 2, 3 and 5 year terms |
| Safety | Insured up to 5 lakh per bank | Full sovereign guarantee |
| Senior citizen extra | Usually yes | No separate senior rate |
| Tax saving version | 5 year tax saver FD | 5 year time deposit |
| Interest paid | Monthly, quarterly or at maturity | Every year |
Read our post office FD guide for the time deposit rules and premature closure penalties.
Recurring deposits: saving a fixed sum each month
An RD takes the same amount every month and returns the total with interest at the end. Banks usually pay on an RD the same rate as an FD of the same tenure. The post office RD runs for five years and earns 6.7%, compounded every quarter. Saving 1,000 rupees each month for five years, the maturity amount comes to about 71,000 rupees going by the current rate. Your own deposits make up 60,000 of that.
Missing an instalment usually brings a small penalty, and many missed instalments can close the account. Learn the basics in what an RD is, see how banks price it in RD interest rate, or try the RD calculator.
Tax and TDS on deposit interest
The tax office treats deposit interest as income from other sources. You owe tax on it in each year it accrues, at the slab that applies to you, even when the bank pays it out only at the end. Banks and post offices deduct TDS once the yearly interest you earn from one bank or post office goes past the limit set in the Income Tax law, which is higher for senior citizens. Without a PAN, TDS is deducted at a higher rate.
When your whole income for the year stays under the level where tax starts, hand in Form 15G (below 60) or Form 15H (60 and above) to the bank every April, before interest is credited, so that tax is not held back. Any TDS deducted shows in your Form 26AS and can be claimed back in your return. The full rules are on tax on FD interest and on the official income tax portal.
Breaking an FD early and loans against it
Most banks let you close an FD before maturity, but pay only the rate that applied to the shorter time the money actually stayed, minus a penalty that is often half to one percentage point. Tax saver FDs cannot be closed early. If you need cash for a short time, a loan against the FD can cost less than breaking it. The loan against FD interest rate is usually set a little above the deposit rate, and banks commonly lend up to about 90% of the deposit value. Check the exact margin with your branch.
Detailed guides on FD, RD and deposits
| Topic | What you learn or get | Useful for | Page |
|---|---|---|---|
| What is FD | How a fixed deposit works, from opening to maturity | First time depositors | FD basics |
| FD calculator | Maturity and interest for any rate and tenure | Anyone comparing deposits | Open calculator |
| Highest FD rates | How to read and compare rate cards | Savers looking for a better rate | Comparing rates |
| Senior citizen FD | Extra rate and special deposit rules | Depositors aged 60 and above | Senior FD guide |
| Tax on FD | TDS, Form 15G and 15H, reporting interest | Every FD holder | Tax rules |
| What is RD | Monthly saving with a fixed rate | Salaried and small savers | RD basics |
| RD interest rate | How banks and the post office price RDs | RD savers | RD rates explained |
| RD calculator | Maturity of a monthly deposit | Anyone planning an RD | Open calculator |
| RBI Retail Direct | Buy government securities directly from the RBI | Savers wanting government bonds | Retail Direct guide |
| Capital gains account | Park capital gains until you reinvest | People who sold property or assets | CGAS guide |
Frequently asked questions
Where can I see all bank FD interest rates list in one place?
There is no single official list of every bank's card. Each bank publishes its own on its website and at branches. The RBI publishes average term deposit rates for the whole banking system in its monthly bulletin, which shows the general trend.
Are FD interest rates in banks the same for every amount?
No. Deposits below the bulk limit follow the published card. Deposits of 3 crore and above at most commercial banks get a separate bulk rate, which can be higher or lower.
Can the bank cut my FD rate after I open it?
No. The rate on the deposit receipt holds until maturity. A cut affects only new deposits and renewals.
What is the interest on 1 lakh FD for 1 year?
At a rate of 7% a year compounded quarterly, a deposit of 1 lakh becomes roughly 1,07,186 rupees after one year. At 6% it becomes about 1,06,136 rupees. Use your bank's actual rate in the FD calculator.
Is a small finance bank FD safe?
Small finance banks are licensed and regulated by the RBI, and the same 5 lakh insurance per person per bank applies to them as to other commercial banks. Amounts above that are not insured.
Is the post office FD rate higher than a bank FD rate?
It depends on the bank and the tenure. The post office 5 year time deposit earns 7.5% now, which is more than many large banks pay for five years, but some banks pay more for shorter tenures.
Official sources
- Reserve Bank of Indiawww.rbi.org.in
- India Post: time deposit and RDwww.indiapost.gov.in
- Income Tax Departmentwww.incometax.gov.in
Rules, amounts and portals can change. Check the official source before you apply or deposit.