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Kotak Mahindra, South Indian Bank, Bandhan Bank increase FD interest rates. Check here for scheme details

Kotak Mahindra, South Indian Bank, Bandhan Bank increase FD interest rates. Check here for scheme details

Fixed deposit schemes: When it comes to investment and long-term savings schemes, fixed deposits are still the most popular instrument for risk-averse people. One should note that like all other investment options, returns on FD schemes are taxable.

When it comes to investment and long-term savings schemes, fixed deposits are still the most popular instrument for risk-averse people. When it comes to investment and long-term savings schemes, fixed deposits are still the most popular instrument for risk-averse people.

Most banks have revised the interest rates on fixed deposits (FDs) of various tenures after the Reserve Bank of India increased its repo rate on August 5. Private sector lenders Kotak Mahindra Bank, South India Bank, Bandhan Bank are the latest banks to revise its interest rates on fixed-term deposits below Rs 2 crore. When it comes to investment and long-term savings schemes, fixed deposits are still the most popular instrument for risk-averse people. One should note that like all other investment options, returns on FD schemes are taxable. Therefore, while investing, one should calculate and compare the post-tax returns.

Kotak Mahindra Bank

The bank has hiked the interest rates on fixed deposits tenured between 2 and 10 years by 10 basis points, as per the details on its website. On fixed deposits maturing in 7 days to 10 years, the bank is now promising an interest rate ranging from 2.50 per cent to 6.10 per cent for the general investors. For senior citizens, the interest rates are a little higher, and are between 3 per cent and 6.60 per cent. The new rates took effect on September 19, 2022.

Also read: Union Bank of India revises interest rate on fixed deposits below Rs 2 crore, check more details here

The bank is offering an interest rate of 2.65 per cent on term deposits maturing in 15 to 30 days and an interest rate of 2.50 per cent on fixed deposits maturing in 7 to 14 days. On schemes maturing in 31 to 90 days, it is offering an interest rate of 3.25 per cent, while on fixed deposits maturing in 91 to 179 days, the bank has maintained its current interest rate of 3.75 per cent.

Fixed deposits with maturities between 180 and 363 days will continue to pay interest at a rate of 5.00 per cent, while term deposits with maturities between 364 days will continue to earn interest at a rate of 5.25 per cent. For deposits maturing in 365 days to 389 days, the bank is offering an interest rate of 5.75 per cent, while it has maintained a rate of 6.00 per cent on term deposits maturing in 390 days (12 months and 25 days) to less than 23 months.

Schemes with maturities of 23 months to less than 2 years will continue to pay interest at a rate of 6.10 per cent, but fixed deposits with maturities of 2 years and above up to 10 years will now provide an interest rate of 6.10 per cent, up from 6 per cent before, a 10 basis point increase.

Withdrawal clause

The bank has said it would impose a penalty charge of 0.50 per cent for premature withdrawals of fixed deposits for schemes with a maturity of more than 180 days but less than or equal to 364 days. The penalty charge will be 1.00 per cent of the deposited amount for premature withdrawals with a maturity of more than 365 days.

Maturity Periods General investors Senior citizens
7 - 14 Days

2.50%

3.00%

15 - 30 Days 2.65% 3.15%
31 - 45 Days 3.25% 3.75%
46 - 90 Days 3.25% 3.75%
91 - 120 Days

3.75%

4.25%
121 - 179 days 3.75% 4.25%
180 Days

5.00%

5.50%
181 Days to 269 Days 5.00% 5.50%
270 Days 5.00% 5.50%
271 Days to 363 Days 5.00% 5.50%
364 Days 5.25% 5.75%
365 Days to 389 Days 5.75% 6.25%
390 Days (12 months 25 days) 6.00% 6.50%
391 Days - Less than 23 Months 6.00% 6.50%

23 Months

6.10% 6.60%
23 months 1 Day- less than 2 years 6.10% 6.60%
2 years- less than 3 years 6.10% 6.60%
3 years and above but less than 4 years 6.10% 6.60%
4 years and above but less than 5 years 6.10% 6.60%

South India Bank

Private sector lender South Indian Bank has also revised its interest rates for fixed deposits with maturities ranging from 1 year to 10 years, which are already effective from September 20, 2022. The interest rates for fixed deposits with maturities ranging from 7 days to 10 years range between 2.65 per cent and 6.00 per cent for general investors, and 3.15 per cent to 6.50 per cent for senior citizens.

The bank will pay 2.65 per cent interest rate on FDs with maturities between 7 and 30 days. The interest rate for term deposits with maturities between 31 and 90 days is 3.25 per cent. The interest rate on fixed deposits with maturities between 91 and 180 days will remain at 4.25 per cent, while the interest rate on term deposits with maturities between 181 and less than a year will remain at 4.60 per cent.

Also read: Axis Bank Fixed Deposit rates vs SBI Fixed Deposit rates: Check out latest rates, withdrawal clauses

The bank has increased its interest rate on fixed deposits maturing in 1 year to less than 3 years by 80 basis points, from 5.60 per cent to 6.40 per cent. The interest rate on term deposits between 3 and 5 years has been increased from 5.75 per cent to 5.90 per cent, an increase of 15 basis points, while the interest rate on term deposits with maturities between 5 and 10 years has increased from 5.85 per cent to 6.00 per cent, an increase of 15 bps.

The interest rate for the "Tax Gain (5 Years)" fixed deposit scheme has been raised from its previous level of 5.85 per cent to 6 per cent by 15 basis points.

Tenure General Senior Citizens
7 days to 30 days 2.65% 3.15%
31 days to 90 days 3.25% 3.75%

91 days to 180 days

4.25% 4.75%
181 days to less than 1 year 4.60% 5.10%
1 year to less than 3 years

6.40%

6.90%
3 years to less than 5 years 5.90% 6.40%
5 years to up to and including 10 years 6.00% 6.50%
Tax Gain ( 5 Years ) 6.00% 6.50%

Withdrawal clause

According to the information on its website, the bank will charge a penalty for early withdrawal of deposits, including recurring deposits, at a rate of 0.50 per cent for deposits under Rs 15 lakh and 1 per cent for deposits of Rs 15 lakhs and beyond for deposits created or renewed up until May 31, 2022.

Bandhan Bank

Kolkata-based Bandhan Bank has revised its interest rates on bulk fixed deposits, which are effective from September 21, 2022. After the latest revision, the bank is offering interest rates between 3.25 per cent and 7.25 per cent for all FD schemes. All schemes have a premature withdrawal facility, although the interest rate is higher without a premature withdrawal payment option.

An investor can get the highest rate of 7.25 per cent for 365 days to less than 15 months, while the rate is 6 per cent from 91 days to 364 days, and between 15 months to less than 5 years. The interest rate is 5 per cent on the highest tenure of 5 years to 10 years

For shorter tenure, the interest rates are 5.05 per cent for 46 days to 90 days tenure. For 7 days to 45 days, the interest rate is between 3.25 per cent and 3.75 per cent.

Withdrawal clause

On its website, the bank has stated that in case of premature withdrawal, a penalty of 1 per cent will be levied on the corresponding ROI.