Banks have increased the interest rates on fixed deposits (FDs) of various tenures. This is good news for risk-averse people who have been forced to accept decadal low interest rates as a result of banks’ ongoing rate reductions in previous years.

Post office term deposits

Every three months of the year, the government sets the interest rates for various savings programs. With bank fixed deposits gaining back its popularity as a result of the RBI rate hikes, it was anticipated that small savings scheme rates would increase. However, they were left unchanged for this quarter, i.e., for Jul-Sep 2022.

Interest rates on Post Office Term Deposits

For the quarter ending September 30, 2022, the Post Office offers a 5.5 percent interest return on term deposits made for one to three years. 6.7 percent interest is paid on a 5-year term deposit. For these term deposits, interest is calculated quarterly but paid annually.

There is no maximum investment amount; the minimum is Rs 1,000. According to Section 80C of the Income Tax Act, the deposit you made into the 5-year fixed deposit account is eligible for an income tax deduction.

As on August 18, 2022, HDFC Bank offers an interest rate of 5.50 percent for tenure between one to three years. Note that if you book FD between three years one day to five years, you will get 6.1 percent.

ICICI Bank offers interest rates between 5.50 percent and 5.60 percent for tenure between one to three years, as on August 19, 2022. If you book FD between three years one day to five years, you will get 6.1 percent.

SBI offers interest rate between 5.45 percent to 5.50 percent for tenure between one to three years. If you book FD between three years one day to five years, you will get 5.60 percent. These interest rates are effective from August 13, 2022.