Personal Finance News

Increment of interest on fixed deposits for senior citizens by more than 7%: Yes Bank, DCB, RBL

In order to earn a regular monthly income after retirement, many senior citizens prefer to invest their savings in fixed deposits

Investment in FDs is considered safer as compared to investment in equity markets since they are less volatile with lower risk of losing the principal amount.

However, falling bank deposit rates have reduced their monthly income sharply in the last one year or so because the banks have reduced the interest rates on fixed deposits.

This was followed across the tenures after a steady repo rate cut from the Reserve Bank of India.

Despite falling interest rates, there are still some banks that offer attractive rates on three-year FDs for senior citizens to lock into.

The smaller private banks tend to top the rate chart on fixed deposits, given the competition they face in garnering deposits.

They are offering interest rates of up to 7.50 percent on three-year FDs for senior citizens as per data compiled by Bank Bazaar.

The interest rate offered by Yes Bank, DCB Bank, and RBL Bank is 7.50 percent, 7.45 percent, and 7.25 percent respectively on their three-year FDs for senior citizens.

Major private banks such as Axis Bank and Kotak Mahindra Bank offers 5.9 percent and 5.25 percent interest respectively on three-year FDs.

On the other hand, public sector banks like Canara Bank and Union Bank of India are offering 6 percent interest on their three-year FDs for senior citizens.

However, Bank of India and State Bank of India (SBI) are offering 5.8 percent interest.

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