Owing to the current recession and RBI regulations, the latest FD rates in India are declining. The recent cut made by the RBI in the repo and reverse repo rate has caused more heartache for FD investors, particularly senior citizens who rely on interest income.
As you all know that your returns on FD are solely dependent upon the interest rate you get, so it becomes immensely important to know all about the latest FD rates. Nonetheless, it should be the first and basic step of every smart investor.
So read along and take a comprehensive look at the latest FD rates in India.
Factors affecting the latest FD Rates
The factors affecting the latest FD rates in India can be broadly classified into 2 i.e Economic factor and Choice factor.
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Economic Factor
- Fiscal Deficit and Government Debt
When the Government buys more securities, banks are injected with more money than they can use to lend, implying Fixed Deposit rates to fall. On the contrary, when the government sells securities, money is lost from banks meaning that there is less funding at banks to lend, forcing the rise in interest rates.
- Inflation
Another factor in deciding Fixed deposit rates is inflation. Fixed Deposit interest rates are directly proportional to the inflation level implying higher the inflation rate, higher the interest rate. This happens because lenders want higher interest rates to compensate for the purchasing power of future payments.
- The central bank
Banks reduce deposit rates when there is no relief in credit growth. On the other hand, when demand for credit is high, banks raise Fixed deposit rates as they need more money to lend.
- Liquidity
In contrast to tight liquidity, banks do not have to focus on retail fixed deposits for their needs when there is sufficient liquidity and banks have to turn to their own deposits.
- Demand and supply
Less demand for credit implies a reduction in fixed deposit rates. Conversely, if there is a high demand for credit, banks will raise FD interest rates. Banks usually reduce rates by lowering the debt rate.
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Choice Factor
- Deposit Amount
It’s your choice how much you want to invest in FDs. The higher the deposit amount, the higher interest you can enjoy. The minimum amount needed to start a fixed deposit account varies across banks. However, there is no limit on the maximum amount in which one can invest in an FD. - Deposit Tenure
Banks offer a lower rate of interest on deposits with a shorter tenure whereas high rates come from big tenure. For instance: Bajaj Finance offers 7.40% of interest on FDs with 12 – 23 months of tenure while 7.60% on FDs with 48 – 60 months of tenure. - Depositor Type
All banks and NBFCs in India offer higher interest on senior citizen’s FDs. With Bajaj Finance Fixed Deposits senior citizens can enjoy interest rates up to 7.85%.
- Deposit Type
As an investor, it’s your choice to invest in either Fixed deposits or Recurring Deposits depending on your needs and goals. The major difference between RD and FD is in their interest payout facility.
Difference between RD and FD: Interest on FDs can be earned on the entire amount deposited on monthly, quarterly or half-yearly basis. Whereas, interests on RDs come on a recurring basis. For instance, with RD of 1 year, the first deposit will earn you interest for 12 months, the second deposit for 11 months and so on.
The RD and FD interest rates are quite the same; however, one will earn more with an FD on the same interest rate and tenor when compared to an RD.
List of latest FD Rates of reputed Banks, NBFCs in India
| Name | Tenure of 1 year | Tenure of 3 years | Tenure of 5 years |
| Bajaj Finance | 7.40% | 7.50% | 7.60% |
| SBI | 5.25% | 6.00% | 6.25% |
| ICICI | 4.00% | 6.5% | 6.5% |
| Citi Bank | 3% | 5% | 5% |
| Axis Bank | 3.5% | 6.7% | 6.7% |
| HDFC Bank | 3.5% | 6% | 6% |
| Canara Bank | 4.20% | 6.20% | 6% |
| HDFC Bank | 3.5% | 6% | 6% |
| IDFC First Bank | 4% | 4.5% | 4.6% |
As the table shows, Bajaj Finance Fixed Deposits offer the highest returns on FDs. And as the only Indian NBFC with an international rating of ‘BBB’ by S&P Global, your investments in Bajaj Finance FDs are never at risk. You can start investing in Bajaj Finance FDs with a minimum deposit of Rs. 25,000.
List of latest FD Rates announcements by Small Finance Banks
| Name of the Bank | FD Rates | W.e.f |
| Fincare Small Finance Bank | 6.75% – 9.00% | March 23 2020 |
| Suryoday Small Finance Bank | 7.75% – 9.00% | April 2 2020 |
| Jana Small Finance Bank | 7.50% – 8.25% | March 3 2020 |
List of latest FD Rates offered by Indian Post Offices
| Deposit tenure | Post Office FD rates (p.a) |
| 1 year | 6.90% |
| 2 years | 6.90% |
| 3 years | 6.90% |
| 5 years | 7.70% |
Bajaj Finance FD return Calculator
With the help of Bajaj Finance FD return Calculator, you can easily determine your FD returns even before you start investing. It helps you make a smart investment decision by comparing returns from different banks and NBFC FDs and thus choosing the best.
How to use Bajaj Finance Fixed Deposit return Calculator?
Using an FD return calculator is very simple. Just follow these quick steps to find your earned interest:
- Choose your customer type, i.e. New Customer or Existing Loan Customer or Senior Citizen
- Select the type of Fixed Deposit you want, ie cumulative or non-cumulative
- Select the amount of your fixed deposit
- Select the preferred term of fixed deposit
Owing to the current recession and RBI regulations latest FD rates in India are declining. And as you all know that your returns on FD are solely dependent upon the interest rate you get, so it becomes immensely important to know all about the latest FD rates.
Factors affecting the latest FD Rates
The factor affecting the latest FD rates in India can be broadly classified into 2 i.e Economic factor and Choice factor.
1. Economic Factor
- Fiscal Deficit and Government Debt
- Inflation
- Central Bank
- Liquidity
- Demand and Supply
- Choice Factor
- Deposit type
- Deposit tenure
- Depositor type
- Deposit type
Hope all this information about the latest FD rates in India helps you get maximum returns out of your FD investment.
Author Bio:
Gaurav Khanna is an experienced financial advisor, digital marketer, and writer who is well known for his ability to predict market trends. Check out his blog at Highlight Story.
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