Best Fixed Deposits From Private & Govt Banks Offering Interest Upto 8.35%

Interest rates have risen sharply over the last few quarters, after the Reserve Bank of India hiked interest rates. Going forward there is a possibility that interest rates may have peaked. Here are some private sector banks that offer attractive interest rates up to 8.35%.

DCB Bank

The bank offers an interest rate of 8.35% on deposits from 700 days to 36-months for those who are senior citizens. The deposits of exactly 36-months also offer investors an interest rate of 8.35% for senior citizens. Now coming to interest rates on regular fixed deposits, 700 days to 36-months at DCB Bank gives an interest rate of 7.85%, which is not bad at all. On the other hand 36-months deposits on regular deposits offer an interest rate of 7.85% as well. It is more advisable to go for the long-term duration of deposits as interest rates could fall in the coming days.

IDFC First Bank

IDFC First Bank offers an interest rate of upto 8% for senior citizens on 18 months - 1 day to 3years deposits. The interest rates offered for domestic customers, who are not senior citizens is 7.50% on the same tenure. This is the best that the bank offers in terms of interest rates. If you go for the other tenures the interest rates are far lower. The best thing to do right now is to look for longer term tenures. Apart from this remember that interest rates may have almost peaked now. So, if you are looking to invest in fixed deposits, now may be the right time. Most analysts predict another 25 basis points hikes, before some stability.

PNB Fixed deposits

PNB has a 666 days deposit, where the interest rates for super senior citizens is 8.05%. Senior citizens are given an interest rate of 7.75%, while regular deposits fetch an interest rate of 7.25%. All these are on deposits of under Rs 2 crores. The next best slab has interest rates of 6.75%, 7.25% and 7.55% for regular deposit holders, senior citizens and super senior citizens. The PNB deposits are much better in terms of interest rates when compared to some of the other government owned banks on the 666 day deposits. Also, since the bank is majority owned by Government of India, investors can rest assured on getting back their principal amount and interest.

Things to note

Invest for long-term tenures as we expect some fall in interest rates, later during the course of the year or early next year. Also, if you are not liable to pay income tax, better to submit form 15g and form 15h, so as to avoid TDS being cut. Apart from this, it is also important to remember that loans are available against fixed deposits, so you can avail the same.