Fixed deposits are one of the best ways to save money and earn substantial interest, while keeping your cash safe. They offer a good return on investment with competitive interest rates provided by banks. Fixed deposits require a one-time payment when the account is opened. The interest rates offered depend on the deposit amount and tenure you choose.

What are Fixed Deposits?

A fixed or term deposit is a one-time lump sum option that offers a guaranteed return on your investment. It is provided by the bank or other financial institutions and has a predetermined duration, ranging from a few months to several years. FDs are renowned for their low risk and are regarded as secure investments due to their guaranteed returns.

Best FD rates for senior citizens are a great advantage for senior citizens to get high-interest rates, and also a few fixed deposits qualify for income tax deductions under Section 80C of the Income Tax Act. Check out the latest fixed deposit rates offered by major banks before opening a new FD or renewing an existing one, as they vary based on the duration and investment amount. FDs are a simple and reliable investment option that ensures consistent growth of your savings.

Top Banks for FD Interest Rates in India 2025

You are free to select the investment amount and duration and get the best FD interest rates in India. Additionally, you can also choose interest payment options, such as receiving payments periodically or at maturity. The interest rates on term deposits can change from time to time. Interest rates paid by banks on fixed deposits vary depending on the tenure, amount, age of the depositor, and the bank. Below is a list of the most trusted banks by the public to get the best FD rates in banks.

Best FD Interest Rates 2025

Best FD Interest Rates Features:

1. The tenor of an FD can vary from a few days to several years. The investor selects the tenor when opening the FD account. Once set, the tenor cannot be changed.
2. Fixed returns are offered by FDs. A predictable maturity value is achieved by the interest rate being unaffected by market fluctuations.
3. Investors can pick between cumulative and non-cumulative FDs. Interest is compounded and paid at maturity in cumulative FDs. Interest is paid periodically in non-cumulative FDs (monthly, quarterly, half-yearly, or annually)
4. Flexible withdrawals are offered by FDs, which are meant to be held until maturity. This typically results in a penalty, and the interest rate applicable may be lower than the contracted rate.
5. Up to 90% of the FD amount is provided by banks and NBFCs. Investors get the cash they need without breaking their bankroll.
6. Interest earned on FDs is taxed under the Income Tax Act, 1961. Interest is added to the investor's income and is taxed as per the applicable slab rates. The TDS is also applicable if the interest exceeds Rs 40,000 per annum and Rs 50,000 for senior citizens.

Best FD Rates In Bank With Their Benefits:

1. FDs are a very secure investment since they are not affected by market changes. Your principal amount is protected, making it ideal for investors who are cautious.
2. The interest rate is fixed when you invest, so you can know exactly how much you will receive at maturity.
3. With non-cumulative FDs, you can receive regular income, which helps manage expenses, especially for senior citizens.
4. The duration of the FD can be adjusted based on your financial objectives and requirements.
5. FDs are easy to manage because they do not require constant tracking or adjustments after investment.
6. Deposits up to Rs 5 lakh per bank per person are insured by the DICGC, which provides extra safety for your money.

Types of Fixed Deposits

Different user groups require different types of fixed-deposit plans. To help you maximise your savings, there are various types of fixed deposits.

Standard Fixed Deposit

Resident Indians, sole proprietorship firms, partnership firms, limited companies, and Hindu undivided families are eligible for this benefit. The interest rates on these fixed deposits surpass those on regular savings accounts.

Tax-saving Fixed Deposit

Available only to Resident Individuals and HUFs, this FD lets you save up to Rs 1.5 lakh in taxes under Section 80C, with a 5-year lock-in period.

Floating Rate Fixed Deposit

The interest rate of this FD changes based on a reference rate like the RBI’s Repo Rate or the T-Bill Rate. This means your returns will vary depending on changes in the reference rate.

Flexi Fixed Deposit

This FD is linked to a savings or current account. If there are insufficient funds, a portion of the FD can be withdrawn, while the remaining balance continues to earn interest. It provides more flexibility and liquidity.

Senior Citizen Fixed Deposit

For people aged 60 or above, offering interest rates that are 0.5% higher than regular FDs. Some banks also offer additional benefits for super senior citizens (80+ years).

Corporate Fixed Deposit

Offered by Housing Finance Companies (HFCs) and Non-Banking Financial Companies (NBFCs), these often have higher interest rates compared to bank FDs.

Cumulative Fixed Deposit

The interest earned is added to the principal, allowing the investment to grow through compounding over time.

Non-cumulative Fixed Deposit

The interest is paid out at regular intervals (monthly, quarterly, half-yearly, or annually), depending on your preference.

Callable Fixed Deposit

You can withdraw your FD before its maturity, but there may be a penalty for early withdrawal.

Non-callable Fixed Deposit

This FD cannot be withdrawn before maturity, but it offers higher interest rates compared to callable FDs.

Types of Fixed Deposits for NRIs

How to select the best bank for FD?

As fixed deposits offer greater interest rates than savings bank accounts, they are one of the most popular savings options among India's millions of investors. There is a difference between the fixed deposit interest rates as per bank.

1. The rate of interest that is paid is one of the most important factors to consider before choosing an FD scheme. Compare the interest rates offered by various banks before committing to the FD plan.
2. Certain lenders permit you to obtain a loan against the amount that is present in the FD account. You may consider opening an FD account with such a bank in case you require funds.
3. Choose a bank with a good reputation and high ratings from agencies like ICRA or CRISIL.
4. The premature withdrawal facility should be offered by a bank when you invest in an FD scheme. It allows you to withdraw the money in case of an emergency. However, in the case of premature withdrawal, a penalty may be imposed.
5. If you opt for a cumulative deposit, the interest will be paid at the time the Fixed Deposit matures. In the event of a non-cumulative deposit, the interest is paid either annually, half-yearly, quarterly, or monthly.
6. A minimum tenure of 1 year is usually offered by NBFCs. However, most banks offer fixed deposit schemes with a minimum tenure of 7 days.
7. Check penalty charges for premature withdrawal to avoid unexpected costs.

How to Open an FD Account?

There are two ways to open an FD i.e. online & offline: For offline, go to the nearest branch of your bank and fill out an application for an FD account. Submit it to the designated office along with the requisite documentation. After depositing the necessary amount, you will receive the FD receipt.

You can open a fixed deposit account online by following these steps:

1. To start the process, visit the bank's official website.
2. If you already have a bank account, simply log in. Otherwise, you should set up a new account.
3. Navigate to the ‘Fixed Deposit’ option.
4. All mandatory fields must be filled, including tenure, amount, nominee and digital signatures.
5. Upload all the necessary documents.
6. Verify all of the information and submit it.
7. Make the payment through internet banking.
8. Keep the receipt for future use.

Eligibility Criteria for Fixed Deposit

The following are eligible to open a fixed deposit account in India:

• Residents
• Hindu undivided families
• NRI
• Minors
• Senior citizens
• Companies
• Individuals or joint investors
• Societies or clubs
• Sole proprietorship
• Partnership firms
• Trust accounts

Documents required for opening the Fixed Deposit

Proof of Identity

Passport, Driving License, Voter ID Card, Aadhaar Card, PAN Card, Government/Defense ID Card, Employer ID Card.

Proof of Address

Utility Bills, Bank Statement, Rental Agreement.

Photograph

One recent passport-sized photograph.

Additional Documents

Self-attested copies of documents, Valid Work Permit or Employment Visa, Residence Visa or Residence Permit, Incorporation Certificate, Partnership Deed.

Documents required for opening the FD for Hindu Undivided Family

• HUF deed and declaration
• KYC documents
• PAN card
• Recent passport-sized photographs

Documents required for opening the FD for Public/Private Limited Company

• Company PAN card
• Latest utility bills
• Board resolution to open FD
• Bank account statement
• Registration or incorporation certificates
• KYC of authorised signatories
• Recent passport-sized photographs

Documents required for opening the FD for Partnership Firm

• PAN card
• Registration certificate
• KYC of all authorised signatories
• Partnership deed
• Recent passport-sized photographs

Documents required for Statutory Board/Local Authority

• PAN card
• Latest utility bills
• Bank account statement
• Certificate of registration/incorporation
• Ministry's or government authority's permission
• KYC of authorised signatories
• Recent passport-sized photographs

Documents required for Registered Societies

• Board resolution to open FD
• PAN card
• KYC of authorised signatories
• Latest utility bills
• Bank account statement
• Recent passport-sized photographs
• Certificate of registration/incorporation
• Articles & memorandum of association

Documents required for Trusts

• Board resolution to open FD
• Copy of trust deed
• Registration certificate
• Recent passport-sized photographs

Conclusion

Fixed Deposits have been one of the most trusted and stable investment channels in India, wherein investors are assured returns and other attractive features, such as flexible tenures and loans. In order to maximize your FD investment, it is imperative to compare interest rates from various banks, taking into account factors such as pre-withdrawal facilitating the bank's reputation and loans against FD provision. Thus, an investor will be able to compare and select among the best available FD schemes according to his or her need-whether he or she is looking for regular income or even just long-term investment growth. And to get the most current FD rates and make a sound decision, CreditKaro is just one of the many sources of information at hand.