Calculate maturity amount and compare FD rates across banks
| Bank | 1 Yr | 2 Yr | 3 Yr | 5 Yr | Maturity Amt |
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* Rates as indicative for 2026. Maturity calculated using quarterly compounding for your selected deposit amount and tenure.
A Fixed Deposit is a financial instrument offered by banks and NBFCs where you deposit a lump sum for a fixed tenure at a predetermined interest rate. It offers guaranteed returns and is considered one of the safest investment options in India. FDs are insured up to ₹5 lakh per depositor per bank by DICGC.
As of 2026, Post Office Term Deposits offer up to 7.5% for 5-year tenure. Among banks, Axis Bank and Kotak Mahindra Bank offer competitive rates around 7.10-7.15% for 2-3 year tenures. Small finance banks may offer even higher rates (up to 8-9%) but with different risk profiles. Always compare latest rates before investing.
Yes, FD interest is fully taxable as per your income tax slab. Banks deduct TDS at 10% if annual interest exceeds ₹40,000 (₹50,000 for senior citizens). You can submit Form 15G/15H to avoid TDS if your total income is below the taxable limit. Interest is taxable on accrual basis each year, not just at maturity.
FDs offer guaranteed returns with zero market risk, making them ideal for conservative investors and emergency funds. Mutual funds can potentially offer higher returns (10-12% CAGR historically for equity) but come with market risk. For goals under 3 years, FDs or debt funds are suitable. For longer horizons (5+ years), equity mutual funds historically outperform FDs after adjusting for inflation and taxes.
A 5-year tax saving FD qualifies for deduction under Section 80C of the Income Tax Act, up to ₹1.5 lakh per year. It has a mandatory lock-in period of 5 years with no premature withdrawal allowed. The interest earned is still taxable. It is a good option for risk-averse investors who want to save tax without market exposure.