Fixed deposits (FDs) remain one of the most preferred investment options for conservative investors in India due to their safety, stability and assured returns. However, with interest rates changing frequently, investors are advised to compare FD rates across banks before locking in funds for the long term.
At present, FD interest rates of scheduled banks range between 2.50% per annum and 8.00% per annum for regular depositors, depending on the tenure. While small finance banks and NBFCs continue to offer the highest returns, several private and public sector banks are also providing competitive interest rates on long-term deposits.
Private Banks Offering High FD Interest Rates
HDFC Bank
India’s largest private sector lender offers 6.45% interest on three-year fixed deposits for regular depositors and 6.95% for senior citizens. The bank provides its highest FD returns for tenures ranging between 18 and 21 months.
ICICI Bank
ICICI Bank offers 6.6% interest on three-year FDs for regular customers and 7.2% for senior citizens, making it one of the better options among large private banks.
Kotak Mahindra Bank
Kotak Mahindra Bank offers 6.4% for regular depositors and 6.9% for senior citizens on three-year FDs. Its highest rates 6.7% and 7.2%, respectively are available for tenures between 391 days and less than two years.
Federal Bank
Federal Bank offers 6.7% interest to regular depositors and 7.2% to senior citizens on three-year fixed deposits, which also happens to be the highest rate offered by the bank.
PSU Banks Offering Competitive FD Returns
State Bank of India (SBI)
India’s largest public sector bank offers 6.3% interest on three-year fixed deposits for regular citizens and 6.8% for senior citizens. SBI’s highest FD rates 6.45% and 6.95% are applicable for tenures between two and three years.
Canara Bank
Canara Bank provides 6.25% interest to regular depositors and 6.75% to senior citizens on three-year FDs. However, its highest rates 6.5% and 7% are offered for a special tenure of 444 days.
Union Bank of India
Union Bank of India offers 6.6% interest on three-year fixed deposits for regular customers and 7.1% for senior citizens, placing it among the top PSU banks for FD returns.
HDFC Bank Cuts FD Rates After RBI’s Repo Rate Reduction
HDFC Bank has revised its fixed deposit interest rates effective 17 December 2025, following the Reserve Bank of India’s decision to cut the repo rate by 25 basis points to 5.25% from 5.50%.
The RBI described the current phase as a “rare Goldilocks period”, where economic growth remains strong while inflation stays moderate. Soon after the RBI’s announcement, SBI and HDFC Bank reduced FD rates on select tenures.
According to reports, HDFC Bank has reduced interest rates on deposits with tenures above 18 months and below 21 months. The revised rate stands at 6.45% for general investors, down from 6.60%, and 6.6% for senior citizens, reduced from 7%.
Revised HDFC Fixed Deposit Rates (Up to ₹3 Crore)
For deposits up to ₹3 crore, HDFC Bank now offers the following rates:
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7–14 days: 2.75% (General) | 3.25% (Senior Citizens)
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15–29 days: 2.75% | 3.25%
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30–45 days: 3.25% | 3.75%
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46–60 days: 3.25% | 3.75%
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61–89 days: 3.25% | 3.75%
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90 days to 6 months: 3.25% | 3.75%
What FD Investors Should Know
With interest rates expected to remain volatile amid RBI policy changes, experts advise investors to compare tenures and banks carefully, especially for long-term fixed deposits. While PSU and large private banks offer stability, select private lenders continue to provide better slab-wise returns.
Sofia Babu Chacko is a journalist with over five years of experience covering Indian politics, crime, human rights, gender issues, and stories about marginalized communities. She believes that every voice matters, and journalism has a vital role to play in amplifying those voices. Sofia is committed to creating impact and shedding light on stories that truly matter. Beyond her work in the newsroom, she is also a music enthusiast who enjoys singing.
