Banking: These top banks are making money for senior citizens; find out if your bank is on the list...

Nowadays, to secure their future, people focus on saving and investing wisely, so they don't face financial problems later. Fixed deposits (FDs) are considered a reliable and safe option, especially for senior citizens. They both protect money and offer good interest at fixed rates. Some small finance banks in the country are currently offering impressive interest rates of up to 8% on 3- to 5-year FDs, making them a strong money-making option.

Excellent interest on 5-year FDs
Yes, if you're 60 years or older and are considering investing in a fixed deposit (FD), there's good news for you. Some small finance banks are offering senior citizens attractive interest rates of up to 8.1% on 5-year FDs. However, this interest rate applies to investments up to ₹3 crore.

Which banks are offering excellent interest rates?

Investing in fixed deposits can prove to be extremely beneficial for senior citizens right now, as some small finance banks are offering attractive interest rates on 5-year FDs. Suryoday Small Finance Bank offers up to 8.1% interest, while Jana Small Finance Bank offers 8%. Utkarsh Small Finance Bank is also considered a strong option with a rate of 7.7%.

Highest interest rate of 8.1%
Suryoday Small Finance Bank is offering 8.1% interest on 5-year FDs for senior citizens.

8% interest rate

Jana Small Finance Bank is offering 8% interest on 5-year FDs for senior citizens.

7.7% interest rate

Senior citizens can earn up to 7.7% interest on 5-year FDs at Utkarsh Small Finance Bank.

Which banks offer how much interest?
Bank Name Interest Rate (for senior citizens)
Suryoday Small Finance Bank 8.1%
Jaana Small Finance Bank 8%
Utkarsh Small Finance Bank 7.7%

What to consider when investing?
The interest on FDs in small finance banks may be very tempting, but prudence is essential before investing. These banks generally offer higher returns than government and large banks, but they also carry a slightly higher risk. Keep in mind that your deposits in these banks are only protected up to ₹5 lakh under the DICGC. This means that even if the bank faces a crisis, you are guaranteed this much money. Therefore, senior citizens are advised to always keep their investments within this limit.

What is TDS on FDs?
Interest earned on FDs is also taxable. So, if the total interest earned from your FDs in a financial year exceeds ₹1 lakh, the bank deducts TDS on it. Many people mistake this for additional tax, but it isn't. TDS is simply a tax deducted in advance. When you file your ITR, you can get this amount back as a refund, or it can be adjusted against your total tax liability.

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