The interest rates for fixed deposits (FDs) can vary depending on the bank and the term of the deposit. Generally, the interest rate for FDs is higher than the rate for savings accounts. Interest rates also tend to increase as the term of the deposit increases.
Currently, there are many banks that offer high-interest rates on Fixed Deposits (FDs) and these rates may change over time. Some banks which offer high-interest rates on FDs include:
- RBL Bank: 7.50% to 8.50%
- Yes Bank: 8.00% to 8.75%
- Lakshmi Vilas Bank: 7.50% to 8.50%
- IndusInd Bank: 7.40% to 8.40%
- ICICI Bank: 7.20% to 8.00%
It’s important to note that these rates may vary depending on the deposit term, location and other factors. The interest rate for senior citizens may also be higher than for other depositors. It’s always a good idea to check with a specific bank for current information, terms, and conditions and compare the offers and benefits with other FDs to make the best decision.
How many types of fixed deposits are there?
There are several types of fixed deposits that you can choose from, depending on your financial needs and goals. Some of the most common types of fixed deposits include:
Regular fixed deposit: This is the most basic type of fixed deposit, where you deposit a lump sum of money for a specified term and earn interest on it.
Cumulative fixed deposit: This type of fixed deposit earns compounded interest throughout the term, and the interest earned is added to the principal amount.
Non-cumulative fixed deposit: This type of fixed deposit earns simple interest throughout the term, and the interest is paid out at regular intervals (such as monthly, quarterly, or annually)
Tax-saving fixed deposit: This type of fixed deposit is eligible for tax deductions under Section 80C of the Income Tax Act.
Recurring deposit: This type of fixed deposit allows you to make small deposits at regular intervals (such as monthly) over a specified term.
Short-term fixed deposit: This type of fixed deposit has a term that is less than one year.
Long-term fixed deposit: This type of fixed deposit has a term that is more than one year.
Flexi fixed deposit: This type of fixed deposit allows you to withdraw a portion of your deposit while keeping the rest of it invested.
Joint fixed deposit: This type of fixed deposit is opened in the name of two or more people.
Minor fixed deposit: This type of fixed deposit is opened in the name of a minor.
It’s always a good idea to check with a specific bank for more information, terms, and conditions.
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What are the features of a fixed deposit account?
A fixed deposit (FD) account is a savings account where the depositor agrees to keep a certain amount of money in the account for a specified period of time, usually ranging from a few months to several years. The key features of a fixed deposit account include:
1. Guaranteed returns: The interest rate on a fixed deposit account is generally higher than that on a regular savings account, and is guaranteed for the entire term of the deposit.
2. Fixed term: The depositor agrees to keep the money in the account for a specified period of time, typically ranging from a few months to several years.
3. Higher interest rates for longer terms: Interest rates on fixed deposit accounts tend to be higher for longer deposit terms.
4. Early withdrawal penalties: Most banks charge a penalty for withdrawing money from a fixed deposit account before the end of the term.
5. Premature withdrawals: Some banks allow for premature withdrawals, but with lower interest rates.
6. Auto-renewal option: Some banks offer the option to automatically renew the fixed deposit at maturity, for the same term and interest rate.
7. Tax saving options: Some banks offer tax saving options under fixed deposits.
8. Joint account: Some banks allow the opening of fixed deposit accounts jointly.