Comparative Analysis: Best FD Rates Offered by Banks in 2023

Feb 13th 2024
Fixed Deposit
Comparative Analysis: Best FD Rates Offered by Banks in 2023

When it comes to choosing the safest and most consistent investment avenue in India, a majority of people would prefer a fixed deposit. Despite the evolution of several new investment apparatuses available in the world today, the craze for fixed deposits is now showing signs of depression. From senior citizens to housewives, working professionals, and even businessmen, fixed deposits are their all-time favorite investment tools for ages. There are lots of benefits fixed deposits offer to people – stable interest rates, superior levels of safety and security, multiple payment choices, zero market risks, income tax benefits, and more. 

If you are looking to invest your hard-earned money in a fixed deposit that offers the best interest rate, here is a comparative study that highlights the best-performing fixed deposits by various banks in India. 

What Is A Fixed Deposit?

A fixed deposit is a money-saving instrument by banks and non-banking financial corporations (NBFCs) for people who can invest their money to get returns at a pre-set interest rate. Upon maturity, the person would get the invested amount along with the accumulated interest from the bank. Since these schemes are not market-linked, they are considered safe and secure investment avenues.

Salient Features Of Fixed Deposits From Banks

  •  Better security than other investment tools
  •  Enables investors to earn interest over a set time period
  •  Can invest money for up to 10 years
  •  No limit on the maximum amount of deposit
  •  Senior citizens may get a higher interest rate

Best FD Rates Offered By Banks in 2023

Below is a list of banks and their respective fixed deposit schemes that offer the most attractive interest rates in 2023.

FD Scheme

All Bank FD Interest Rates 2023

IndusInd Bank Tax Saver Scheme

6.75% - 7.50%

Union Bank of India Tax Saving FD

6.70% -

RBL Bank Tax Saving FD

6.55% - 7.05%

Canara Bank Tax Saving FD

6.50% -

IDBI Bank Tax Saving FD

6.10% - 6.85%

Axis Bank Tax Saving FD

6.10% - 6.85%

HDFC Bank Tax Saving FD

6.10% - 6.60%

SBI Bank Tax Saving FD

6.10% - 6.60%

Punjab and Sind Bank Tax Saving FD

6.10% - 6.60%

PNB Tax Saving FD

5.80% - 6.30%

Bank of Baroda Tax Saving FD

5.65% - 6.30%

IDFC First Bank Tax Saving FD


Benefits Of Fixed Deposits From Banks

There are several benefits of investing in fixed deposits including:

Guaranteed Returns

This is one aspect of fixed deposits why investors choose to invest their money in them. You can bet on getting the said rate of return after you deposit the money into a fixed deposit account. The interest a client will earn on an investment in a particular amount of money for a specific period may be calculated using the fixed deposit interest calculators that banks make available on their websites.

Easy Liquidation

 The liquidation of a fixed deposit is quite easy. One can even use net banking to liquidate FDs that have been registered online. If not, the majority of bank branches provide easy processes to liquidate FDs.

Flexible Tenure

The fixed deposit duration is negotiable and is determined by the depositor. Although each bank has its own minimum tenure requirements, the depositor has the last say. Choosing to redeem the fixed deposit or to extend it for the same time is another option.

Loans Against Fixed Deposit

A reliable tool to have on hand in case of monetary difficulties is an FD. It's fairly simple to obtain a loan against a set deposit. Depending on the bank, you can borrow up to 95% of the fixed deposit's value. It is therefore a reliable investment.

Tax Savings

In accordance with income tax regulations, banks are not supposed to deduct tax on any interest until it exceeds the ceiling. This gives owners the ease of making small deposits.

How To Open An FD Account?

  • If you want to invest your money in fixed deposits, there are two options.
  •  Online: This is undoubtedly the fastest and easiest way to open an FD account with the bank you already have an account with. You just need to log in to the net banking account, fill out an online FD account opening form and submit it. In such scenarios, KYC is not required as the bank already knows you. 
  •  Offline: Visit the nearest branch of your bank and fill out an application to open an FD account. Deposit the form to the concerned office along with the required documentation. An FD receipt will be provided to you after depositing the needed amount.

Factors Affecting The Interest Rates Of Fixed Deposits

  • The major factors affecting the interest rates of fixed deposits are listed below:
  • Tenure – The lower your deposit tenure, the lower the interest rate will be. The longer your park your money, the better returns you can expect to get. 
  •  Amount – The more amount you invest, the better returns you will get.

Senior Citizens and sometimes women can also get better interest rates from banks. 

Taxation And Fixed Deposits

  • The interest accumulated on your FD is considered Income from Other Sources and the applicable tax is levied by the authority.
  • If the returns from fixed deposits are below Rs.40,000 per year, there will be no TDS deduction.
  •  At the beginning of the fiscal year, it is necessary for you to fill and deposit Forms 15G and 15H to the bank. Once this is done, banks would not deduct TDS.

The Conclusion

In today’s volatile market scenarios, fixed deposits are emerge as a safer and effective money saving instruments for all types of people. With so many fixed deposit schemes made available by the banks, it would be quite easier for you to choose the best plan for you. However, if you need any kind of help in choosing the most appropriate fixed deposit, you can consult our experts at Investkraft

Here Are More Topics For Your Interest-

Budgeting and Financial Planning in a Post-Pandemic World

Understanding the Impact of Inflation on Your Fixed Deposit Returns


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