City Union Bank vs Karnataka Bank: Which 555-day FD offers higher returns?
City Union Bank offers an interest rate of 7.25% to general citizens for its 555-day FD. Senior citizens get an additional benefit, with the rate going up to 7.50%. Karnataka Bank offers 7% to general citizens for the same tenure, while senior citizens can earn 7.40%.
- Sep 22, 2026,
- Updated Sep 22, 2026 12:28 PM IST
Fixed deposits (FDs) remain a preferred investment option for those seeking predictable returns without direct exposure to market volatility. Among the 555-day FD options currently offered by select banks, City Union Bank and Karnataka Bank are offering some of the highest interest rates, with City Union Bank offering up to 7.25% to general citizens and 7.50% to senior citizens.
The rates, sourced from Paisabazaar data as of September 16, 2026, can help depositors compare returns before locking in their money for nearly 18 months.
City Union Bank vs Karnataka Bank FD rates
City Union Bank offers an interest rate of 7.25% to general citizens for its 555-day FD. Senior citizens get an additional benefit, with the rate going up to 7.50%.
Karnataka Bank offers 7% to general citizens for the same tenure, while senior citizens can earn 7.40%.
This means City Union Bank offers a 25-basis-point higher rate to general investors compared with Karnataka Bank. For senior citizens, the difference is 10 basis points.
| Bank | General Citizens | Senior Citizens |
|---|---|---|
| City Union Bank | 7.25% | 7.50% |
| Karnataka Bank | 7.00% | 7.40% |
| Bank of Baroda | 6.75% | 7.25% |
| Indian Bank | 6.65% | 7.15% |
| Canara Bank | 6.60% | 7.10% |
| Union Bank of India | 6.55% | 7.05% |
Source: Paisabazaar data as on September 16, 2026.
MUST READ: 555-day FD rates: City Union Bank tops at 7.25%; check rates from 5 other banks
How do the other banks compare?
The rates offered by other banks for the 555-day tenure are lower than those of City Union Bank and Karnataka Bank. Bank of Baroda offers 6.75% to general citizens and 7.25% to senior citizens.
Indian Bank offers 6.65% to general citizens and 7.15% to senior citizens, while Canara Bank offers 6.60% and 7.10%, respectively.
Union Bank of India has the lowest rate among the six banks listed, at 6.55% for general citizens and 7.05% for senior citizens.
What should FD investors consider?
While the interest rate is an important factor, investors should also check the bank’s latest terms, premature withdrawal conditions and applicable tax rules before booking an FD. Rates can change, and the applicable rate is the one offered by the bank at the time of booking.
FD interest is taxable according to the investor’s applicable income-tax slab. TDS provisions also apply when aggregate interest covered under the relevant provisions crosses the prescribed threshold. For non-senior citizens below 60 years, the threshold is ₹50,000 in a financial year, while for senior citizens aged 60 and above, it is ₹1 lakh.
For investors comparing these six options specifically on interest rates, City Union Bank currently offers the highest rate for both general citizens and senior citizens. However, depositors should consider the complete FD terms, taxation and their liquidity requirements before making a decision.
Fixed deposits (FDs) remain a preferred investment option for those seeking predictable returns without direct exposure to market volatility. Among the 555-day FD options currently offered by select banks, City Union Bank and Karnataka Bank are offering some of the highest interest rates, with City Union Bank offering up to 7.25% to general citizens and 7.50% to senior citizens.
The rates, sourced from Paisabazaar data as of September 16, 2026, can help depositors compare returns before locking in their money for nearly 18 months.
City Union Bank vs Karnataka Bank FD rates
City Union Bank offers an interest rate of 7.25% to general citizens for its 555-day FD. Senior citizens get an additional benefit, with the rate going up to 7.50%.
Karnataka Bank offers 7% to general citizens for the same tenure, while senior citizens can earn 7.40%.
This means City Union Bank offers a 25-basis-point higher rate to general investors compared with Karnataka Bank. For senior citizens, the difference is 10 basis points.
| Bank | General Citizens | Senior Citizens |
|---|---|---|
| City Union Bank | 7.25% | 7.50% |
| Karnataka Bank | 7.00% | 7.40% |
| Bank of Baroda | 6.75% | 7.25% |
| Indian Bank | 6.65% | 7.15% |
| Canara Bank | 6.60% | 7.10% |
| Union Bank of India | 6.55% | 7.05% |
Source: Paisabazaar data as on September 16, 2026.
MUST READ: 555-day FD rates: City Union Bank tops at 7.25%; check rates from 5 other banks
How do the other banks compare?
The rates offered by other banks for the 555-day tenure are lower than those of City Union Bank and Karnataka Bank. Bank of Baroda offers 6.75% to general citizens and 7.25% to senior citizens.
Indian Bank offers 6.65% to general citizens and 7.15% to senior citizens, while Canara Bank offers 6.60% and 7.10%, respectively.
Union Bank of India has the lowest rate among the six banks listed, at 6.55% for general citizens and 7.05% for senior citizens.
What should FD investors consider?
While the interest rate is an important factor, investors should also check the bank’s latest terms, premature withdrawal conditions and applicable tax rules before booking an FD. Rates can change, and the applicable rate is the one offered by the bank at the time of booking.
FD interest is taxable according to the investor’s applicable income-tax slab. TDS provisions also apply when aggregate interest covered under the relevant provisions crosses the prescribed threshold. For non-senior citizens below 60 years, the threshold is ₹50,000 in a financial year, while for senior citizens aged 60 and above, it is ₹1 lakh.
For investors comparing these six options specifically on interest rates, City Union Bank currently offers the highest rate for both general citizens and senior citizens. However, depositors should consider the complete FD terms, taxation and their liquidity requirements before making a decision.