FD rates: Public sector banks that offer up to 7.25% interest on 3-year deposits
FD investment in leading public sector banks and private banks comprises 76 percent of total bank deposits. Leading public sector banks such as Bank of Baroda, SBI, Union bank of India, among others are offering the best interest rates on three-year FDs.
According to the Reserve Bank of India's financial year 2022 data, investors prefer to park their money in leading public sector banks and private banks’ fixed deposits. As per the data, FD investment in leading public sector banks and private banks comprises 76 percent of total bank deposits. This is despite smaller private banks and small finance banks offering higher interest rates to garner newer deposits.
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Fixed deposits offer liquidity and assured interest income at regular intervals. Thanks to the ample liquidity they promise, FDs can be useful while building an emergency corpus. Here are the top 11 public sector banks offering the best interest rates on FDs for a tenure of three years. Bankbazaar has compiled the data.
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The key parameter for identifying these banks is the interest rate of the top 20 banks (according to their total term deposit position reported with the RBI as on March 31, 2022). Banks for which data was not available on their websites have not been considered. The data includes 3-year deposit of non-senior citizens for an amount below Rs 1 crore. The value is calculated on the basis of quarterly compounding of interest. Minimum investment amount may vary depending on the type of term deposits account.
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Bank of Baroda offers interest rates of up to 7.25 percent on three-year FDs. Among the public sector banks, this bank offers the best interest rates. A sum of Rs 1 lakh invested here will grow to Rs 1.24 lakh in three years.
Punjab National Bank offers interest rates of up to 7 percent on three-year FDs. A sum of Rs 1 lakh invested here will grow to Rs 1.23 lakh in three years.
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Canara Bank offers interest rates of up to 6.8 percent on three-year FDs. A sum of Rs 1 lakh invested here will grow to Rs 1.22 lakh in three years.
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State bank of India (SBI), Union Bank of India, Bank of India, and Indian Overseas Bank offer interest rates of up to 6.5 percent on three-year FDs. A sum of Rs 1 lakh invested here will grow to Rs 1.21 lakh in three years.
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UCO Bank offers interest rates of up to 6.3 percent on three-year FDs. A sum of Rs 1 lakh invested here will grow to Rs 1.21 lakh in three years.
Indian Bank offers interest rates of up to 6.25 percent on three-year FDs. A sum of Rs 1 lakh invested here will grow to Rs 1.20 lakh in three years.
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Bank of Maharashtra and Punjab & Sind bank offer interest rates of up to 6 percent on three-year FDs. A sum of Rs 1 lakh invested here will grow to Rs 1.20 lakh in three years.
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The Deposit Insurance and Credit Guarantee Corporation (DICGC), a subsidiary of the RBI, guarantees investments in fixed deposits of up to Rs 5 lakh.
Hiral Thanawala is a personal finance journalist with 9 years of reporting experience. Based in Mumbai, he covers financial planning, banking and fintech segments from personal finance team for Moneycontrol.
