After the Reserve Bank of India has started to raise the repo rate, many banks have increased fixed deposit interest rates, passing the benefit on to customers. However, just a few banks have raised interest rates above 7%, and even fewer have gone past 7.15 percent, which is the interest rate on RBI’s floating rate bond.

RBI floating rate bond interest rate

The current interest rate on the RBI floating rate bond is 7.15 percent (6.80% +0.35%) Every six months, the interest rates on these bonds are reset/previewed. According to the RBI press release, “Accordingly, the coupon rate on FRSB 2020 (T) for period July 1, 2022, to December 31, 2022 and payable on January 1, 2023 remains at 7.15% (6.80% +0.35%), unchanged from the previous half-year.” The bonds have a fixed seven-year term.

Here is a quick compilation of banks FD which offer higher interest rate than RBI Bond.

Utkarsh Small Finance Bank

Utkarsh offers 7.25% interest rate on tenure of 700 days to 5 years for regular citizens and 7.75% for senior citizens.

Ujjivan Small Finance Bank

Ujjivan Small Finance Bank offers interest rate higher than RBI savings bond on tenure higher of 12 months and 1 day to 524 days, and 42 months 1 day to 60 months interest rate offered is 7.20%. For tenure 75 Weeks (525 Days) and 990 Days and 75 Months, interest rate offered is 7.50%.

ESAF Small Finance Bank

ESAF Small Finance Bank offers 7.25% interest rate on tenure of 2 years to less than 3 years for regular citizens and 7.75% for senior citizens.

Fincare Small Finance Bank

Fincare Small Finance Bank offers 7.25% interest rate on tenure of 750 days for regular citizens and 7.50 for 1000 days tenure for regular citizens.