Fixed Deposits (FDs) are among the most trusted investment options in India, offering guaranteed returns and financial security. With various banks revising their interest rates, it’s essential to explore the best options available.  

What Are Fixed Deposits (FDs)? 

A Fixed Deposit is a savings product where you deposit a lump sum amount with a bank for a pre-defined period. In return, the bank offers a fixed interest rate, ensuring steady growth of your savings. Fixed Deposits in India offer -  

  • Guaranteed returns regardless of market fluctuations. 

  • Tenures between 7 days to 10 years that suit your investment goals. 

  • Cumulative or periodic interest payout options. 

Why Are FDs Popular in India? 

FDs are a preferred investment option for millions of Indians due to their safety and simplicity. Here’s why they are sought after: 

  • Risk-Free Investment: FDs are unaffected by market volatility, making them ideal for conservative investors. 

  • Reliable Returns: Unlike other investment options, FD returns are predetermined and assured. 

  • Flexible Options: Banks offer varying tenures and schemes, catering to short-term and long-term goals. 

  • Tax Benefits: Tax-saving FDs allow deductions of up to ₹1.5 lakh under Section 80C of the Income Tax Act. 

Average FD Rates Across Banks in India 

Currently, the average FD rates offered by banks are as follows: 

  • Public Sector Banks: 6% to 7.5% for general investors, with an additional 0.5% for senior citizens. 

  • Private Sector Banks: 6.5% to 8% for general depositors. 

  • Small Finance Banks: 7.5% to 9.5%, often outpacing traditional banks. 

Use our FD Calculator to estimate the returns on your Fixed Deposits! 

Top Banks in India Offering the Best FD Rates 2025 

1. North East Small Finance Bank 

North East Small Finance Bank stands out with its highly competitive FD rates, offering a maximum interest rate of 9% per annum for general investors and 9.5% per annum for senior citizens on a tenure of 1111 days. For shorter tenures, the bank provides an interest rate of 7% per annum for general investors and 7.5% per annum for senior citizens on a 1-year FD. On a 3-year FD, the rates are 9% per annum for general investors and 9.5% per annum for senior citizens, while for a 5-year FD, the rates are 6.25% per annum and 6.75% per annum, respectively. These rates make the bank an excellent choice for those seeking long-term, secure, and high-yield investments. 

2. Unity Small Finance Bank 

Unity Small Finance Bank offers one of the highest FD rates, providing a top interest rate of 9% per annum for general subscribers and 9.5% per annum for senior citizens on an FD tenure of 1001 days. For shorter durations, the bank offers 7.85% per annum for general investors and 8.35% per annum for senior citizens on a 1-year FD. On a 3-year FD, the rates are 8.15% per annum for general investors and 8.65% per annum for senior citizens. Similarly, for a 5-year FD, the rates remain at 8.15% per annum for general investors and 8.65% per annum for senior citizens.  

3. Suryoday Small Finance Bank 

Suryoday Small Finance Bank offers attractive FD rates, with a maximum interest rate of 8.6% per annum for general subscribers and 9.1% per annum for senior citizens on an FD tenure of Above 2 Years to 3 Years. For shorter tenures, the bank provides 8.05% per annum for general investors and 8.55% per annum for senior citizens on a 1-year FD. On a 3-year FD, the rates are 6.75% per annum for general investors and 7.25% per annum for senior citizens, while for a 5-year FD, the rates are 8.25% per annum and 8.75% per annum, respectively. 

Suryoday Small Finance Bank requires a minimum deposit of ₹1,000, ensuring accessibility for a wide range of investors. With tenure options ranging from 7 days to 10 years, the bank caters to both short-term and long-term financial goals. Additionally, the bank provides convenient online account management and regular interest payouts, making it a popular choice for risk-averse investors seeking competitive returns. 

4. Utkarsh Small Finance Bank 

Utkarsh Small Finance Bank offers competitive FD rates, with a maximum interest rate of 8.50% per annum for general customers and 9.10% per annum for senior citizens on tenures ranging from 2 to 3 years. For shorter durations, the bank provides an interest rate of 8.00% per annum for general investors and 8.60% per annum for senior citizens on a 1-year FD. On a 3-year FD, the rates are 8.25% per annum for general investors and 8.85% per annum for senior citizens. For a 5-year FD, the rates stand at 7.75% per annum for general investors and 8.35% per annum for senior citizens. 

5. Shivalik Small Finance Bank 

Shivalik Small Finance Bank provides competitive Fixed Deposit rates, offering a maximum interest rate of 8.30% per annum for general customers and 8.80% per annum for senior citizens on tenures ranging from 18 months to 24 months. For shorter durations, the bank offers an interest rate of 6.00% per annum for general investors and 6.50% per annum for senior citizens on a 1-year FD. On a 3-year FD, the rates are 7.50% per annum for general investors and 8.00% per annum for senior citizens. For a 5-year FD, the rates stand at 6.50% per annum for general investors and 7.00% per annum for senior citizens. 

6. Equitas Small Finance Bank 

Equitas Small Finance Bank offers highly competitive Fixed Deposit (FD) rates, catering to various financial needs with flexible tenures and attractive returns. The bank provides an interest rate of 8.25% per annum for general customers on a tenure of 888 days, with senior citizens receiving an additional 0.50%, making their rate 8.75% per annum. For tenures of 2 years 1 day to 3 years, the rate is 8.00% per annum for general customers and 8.50% per annum for senior citizens. 

For other tenures, the interest rates are as follows: 

  • 18 months 1 day to 2 years: Offers an interest rate of 7.75% per annum for general investors and 8.25% per annum for senior citizens. 

  • 3 years 1 day to 4 years: Provides 7.50% per annum for general investors and 8.00% per annum for senior citizens. 

  • For long-term deposits spanning 5 years 1 day to 10 years, the rates are 7.25% per annum for general investors and 7.75% per annum for senior citizens. 

7. Jana Small Finance Bank 

Jana Small Finance Bank offers a range of Fixed Deposit (FD) schemes with highly competitive interest rates. For regular depositors, the bank provides a maximum FD rate of 8.25% per annum, while senior citizens can earn upto 8.75% per annum for tenures ranging from 366 days to 730 days (2 years). 

Other notable rates include 8.25% per annum for general depositors and 8.75% per annum for senior citizens on tenures exceeding 2 years up to 3 years (1095 days). For FDs of 5 years (1825 days), the interest rate is 8.20% per annum for both regular depositors and senior citizens. Long-term FDs exceeding 5 years to 10 years are offered at 6.50% per annum for general depositors and 7.00% per annum for senior citizens. 

8. Ujjivan Small Finance Bank 

Ujjivan Small Finance Bank provides attractive Fixed Deposit (FD) rates, with a maximum interest rate of 8.25% per annum for general investors and 8.75% per annum for senior citizens on FDs of 12 months. For tenures ranging from 12 months 1 day to 560 days (80 weeks), the rates stand at 8.00% per annum for general investors and 8.50% per annum for senior citizens. Shorter tenures like 9 months offer 7.50% per annum for general investors, with an additional 0.50% boost for senior citizens. 

9. ESAF Small Finance Bank 

ESAF Small Finance Bank offers competitive Fixed Deposit (FD) rates, making it an appealing choice for investors seeking secure and rewarding savings options. The bank provides a maximum FD rate of 8.25% per annum for general customers and 8.75% per annum for senior citizens on tenures ranging from 2 years to less than 3 years. For tenures of 1 year 1 day to less than 2 years, the interest rates are 7.75% per annum for general investors and 8.25% per annum for senior citizens. 

While the bank offers attractive returns, it also imposes a 1% penal interest for premature closure of Resident Term Deposits, ensuring investors consider long-term commitments. Income Tax deductions at source (TDS) are applicable on interest earned as per prevailing tax regulations. 

10. SBM Bank 

SBM Bank combines global banking standards with local market expertise. It offers a wide range of tenure options, coupled with attractive rates for longer-term deposits, makes it an appealing choice for investors seeking steady returns. Senior citizens benefit from higher interest rates, further enhancing the value of its FD offerings.  

SBM Bank offers competitive Fixed Deposit (FD) rates tailored to meet the needs of diverse investors. The bank provides a maximum interest rate of 8.25% per annum for tenures ranging from 18 months to less than 2 years 3 days, with senior citizens enjoying an additional 0.50%, taking their rate to 8.75% per annum. For longer tenures, the bank offers 7.75% per annum for FDs of 5 years, 7.40% per annum for 3 years 2 days, and 7.30% per annum for 2 years 3 days. 

Shorter tenure FDs, such as those upto 90 days, offer a lower rate of 4.25% per annum, reflecting the lower risk associated with shorter-term commitments. 

Why Small Finance Banks Stand Out with Higher Fixed Deposit Interest Rates?  

Small finance banks are emerging as leaders in offering higher FD rates. These banks are specifically designed to promote financial inclusion by serving rural and underserved populations. To attract depositors, they offer significantly higher interest rates compared to public and private sector banks.  

For instance: 

  • Unity Small Finance Bank offers upto 9.5% for senior citizens. 

  • Jana Small Finance Bank provides 8.85% for senior citizens. 

FAQs on Best FD Rates 2025 

1. Which bank offers the highest FD rate? 
Unity Small Finance Bank currently offers the highest rate of 9.5% for senior citizens. 

2. Are small finance banks safe for FDs? 
Yes, they are regulated by the Reserve Bank of India (RBI) and insured under DICGC for up to ₹5 lakh. 

3. How much is the minimum investment I need to start an FD? 
The minimum deposit varies but generally starts from ₹1,000. 

4. Is premature withdrawal or closure of a fixed deposit (FD) allowed? 
Yes, most banks allow early withdrawals, but a penalty may apply. 

5. Which bank is best for senior citizens? 
Unity Small Finance Bank offers the highest rate of 9.5% for senior citizens, followed by Jana Small Finance Bank and Utkarsh Small Finance Bank. 

Disclaimer: This page includes information that has been compiled from many sources and is only offered for informational purposes. Since this type of data might change over time, we cannot guarantee that the information supplied or included within it is accurate. It is anticipated that the user would confirm with the relevant source prior to taking any choices or actions.