In keeping with the economy’s rising interest rates, the government increased interest rates on several small savings deposits including post office term deposits for the January-March 2023 quarter. The government determines the interest rates for various savings schemes every three months.

For those who are risk-averse, this is good news as many banks, both public and private, now even post-office term deposits have increased interest rates on fixed deposits (FDs) of various terms.

Now that post office term deposit rates are increased, have they caught up with bank deposit rates? Here is a quick comparison of FD interest rates of big banks including SBI, ICICI Bank and HDFC Bank with post office term deposits.

Post office term deposits (POTD)

After the hike, the POTD earns an interest rate of 6.6%, 6.8% and 6.9% for tenure of one year, two year and 3-year respectively. Customers will earn 7% interest on 5-year post office term deposit after the hike for this quarter.

HDFC Bank FD interest rates

As on December 14, 2022, HDFC Bank offers an interest rate between 6.50% to 7% percent for tenure between one to five years. Less than 5 years, interest rate varies between 3.50% to 6%.

SBI FD interest rates

As on December 13, 2022, SBI offers an interest rate between 6.25% to 6.75% percent for tenure between one to five years. Less than 5 years, interest rate varies between 3% to 5.75%.

ICICI FD interest rates

ICICI Bank offers an interest rate between 6.60% to 7% percent for tenure between one to five years. Less than 5 years, interest rate varies between 3% to 5.75%.

Since May 2022, the Reserve Bank of India (RBI) has started raising key rates. Banks have been raising interest rates on fixed deposits (FD) as a result, which is excellent news for FD investors who have been stuck with decadal-low interest rates.