NBFC FD rates in 2026: Which companies offer the highest returns and who tops the list?

With interest rates remaining attractive and market volatility continuing to keep conservative investors cautious, fixed deposits (FDs) remain a preferred avenue for those seeking stable and predictable returns. While banks continue to dominate the FD landscape, Non-Banking Financial Companies (NBFCs) are increasingly attracting depositors by offering rates higher than those of traditional banks.

Unlike regular savings products, fixed deposits require a one-time lump sum investment for a specified tenure, with guaranteed returns at maturity. Investors can choose payout options such as periodic interest income or cumulative maturity payouts. The biggest differentiator in 2026, however, is the widening gap between bank FD rates and NBFC offerings.

Data on current fixed deposit rates suggest that while large banks such as SBI, HDFC Bank and ICICI Bank offer returns largely in the 6.4%–7.1% range, several NBFCs are providing significantly higher rates, especially for longer tenures.

NBFC FD rates

Among mainstream NBFCs, Shriram Finance stands out with FD rates of 7.6% for regular investors and 8.1% for senior citizens, making it one of the most competitive options in the market. Bajaj Finance follows with rates reaching 7.4% for regular depositors and 7.75% for senior citizens.

However, a closer look at tenure-specific rates reveals that a few specialised finance companies are offering even higher returns.

Manipal Housing Finance Syndicate Ltd. currently offers 8.25% interest for one-year and three-year deposits, among the highest rates in the category. Muthoot Capital Services also ranks among top-paying NBFCs, offering 8.5% on three-year and five-year fixed deposits, making it one of the highest-return options in the market.

Similarly, Sundaram Finance offers rates in the 7.5%–8.07% range for select tenures, while PNB Housing Finance and Shriram Finance continue to offer rates above the 7% mark.

Why NBFC FDs usually offer higher rates

NBFCs typically provide better returns than banks because they rely more heavily on market borrowing and customer deposits to raise capital. Unlike banks, they do not have access to low-cost current and savings account deposits at scale. As a result, they often offer higher rates to attract investor funds.

However, higher returns also require careful risk assessment.

Financial experts generally advise investors to focus on AAA-rated NBFC fixed deposits rated by agencies such as CRISIL and ICRA, since credit quality becomes an important factor. Unlike bank deposits, NBFC deposits do not carry the same deposit insurance structure and therefore require additional due diligence.

Senior citizens may benefit further, as many NBFCs provide an additional 0.25% interest premium, pushing effective returns higher.

Interest income from NBFC FDs is taxable under existing income-tax rules, similar to traditional bank fixed deposits.

For investors willing to take a measured approach and focus on highly rated institutions, NBFC fixed deposits continue to offer an attractive alternative in 2026. With some players now offering returns above 8%, the segment remains one of the more compelling options for conservative investors seeking better yields than conventional bank FDs.