Are you planning to invest in a Fixed Deposit (FD) to grow your savings securely? If yes, then it’s essential to compare interest rates offered by different banks—especially if you're locking in your funds for a long tenure. Long-term FDs not only offer higher returns due to compound interest but are also a preferred choice for conservative investors seeking stability.
To help you make an informed decision, here’s a comprehensive comparison of 5-year FD interest rates offered by six leading banks in India. These banks are known for offering competitive rates and reliable customer service.
Fixed Deposits are one of the most trusted investment options for Indian investors. They offer guaranteed returns, are low-risk, and easy to manage. When you invest in long-term FDs—typically five years or more—you benefit from compound interest, making your savings grow faster.
Moreover, many banks offer preferential interest rates to senior citizens, usually an additional 0.50% per annum, making FDs even more attractive for retirees.
| Bank Name | Regular Rate | Senior Citizen Rate |
|---|---|---|
| HDFC Bank | 6.65% | 7.15% |
| ICICI Bank | 6.75% | 7.25% |
| Kotak Mahindra Bank | 6.20% | 6.70% |
| State Bank of India | 6.30% | 7.30% |
| Bank of Baroda | 6.55% | 7.15% |
| Union Bank of India | 6.50% | 7.00% |
Source: Official bank websites | Rates applicable as of June 2025
1. HDFC Bank
India’s largest private sector bank offers 6.65% interest to regular customers and 7.15% for senior citizens on 5-year FDs. The bank is known for its digital services and financial reliability.
2. ICICI Bank
Another top private lender, ICICI Bank gives 6.75% to regular depositors and 7.25% to seniors, making it one of the most competitive in the market. The additional 0.50% for seniors enhances its appeal.
3. Kotak Mahindra Bank
This bank offers a slightly lower rate, with 6.20% for regular customers and 6.70% for senior citizens. However, Kotak is appreciated for its customer service and modern banking tools.
4. State Bank of India (SBI)
As India’s largest public sector bank, SBI provides 6.30% to regular customers and 7.30% to senior citizens, including a 0.50% premium under the SBI We-Care FD scheme. Its nationwide presence adds to its trust factor.
5. Bank of Baroda
Another major PSU bank, it offers 6.55% to general customers and 7.15% to senior citizens, making it an attractive option for those seeking decent returns and solid institutional backing.
6. Union Bank of India
This government-run bank gives 6.50% to regular customers and 7.00% to senior citizens. It’s a stable choice with good service in both urban and rural areas.
Compare Interest Rates: Rates vary across banks and are updated regularly. Choose a bank that offers the best returns for your investment period.
Consider Tax Implications: FD interest is fully taxable as per your income tax slab. If you're in a higher tax bracket, your post-tax returns could be lower.
Senior Citizen Benefits: Most banks offer an extra 0.50% interest to seniors, which can significantly boost returns over five years.
Bank Reputation: Choose a bank with strong financial standing and good service record. Your peace of mind matters as much as the return on investment.
Premature Withdrawal Penalties: Know the terms in case you need to withdraw before maturity. Some banks levy penalties which can eat into your interest earnings.
Fixed Deposits remain a solid choice for low-risk investors, especially those looking for assured long-term returns. With careful selection based on interest rates, tax planning, and financial goals, you can make your FD investment not just safe, but highly rewarding.
Before locking in your funds, review current FD rates, evaluate the tax impact, and choose the right bank that aligns with your needs. A smart FD investment today could be a stable financial cushion for tomorrow.
