Best Senior Citizen Fixed Deposit Interest Rates

by Manshu on October 20, 2011

in Fixed Deposits

There are some pretty good fixed deposit interest rates on offer for senior citizens right now. The highest rate is Lakshmi Vilas Bank’s 10.75% for a deposit of 1 year to less than 2 years, and that’s followed by Yes Bank’s 10.60% for a 480 day deposit.

There are at least 20 banks that offer more than 10% to senior citizens and they range from a period of 1 year to 3 years. So, there is a good chance that there is a bank somewhere close to you that offers a pretty good interest rate.

I created this list by primarily looking at the list of my regular best fixed deposit accounts, so I won’t be surprised to see that there are more banks that offer more than 10% but aren’t included in this list.

If you know of any – please leave a comment, and I’ll update this list.

S.No. Bank Tenure Interest Rate


REPCO Bank 22 months    11.00%


Lakshmi Vilas Bank 1 year to less than 2 years



Yes Bank  480 days



South Indian Bank 300 days



State Bank of Travancore 500 days



Dhanalaxmi Bank  300 days



City Union Bank 1 year to less than 2 years



Tamil Nadu Mercantile Bank 1 year to less than 2 years



Axis Bank 1 year to less than 14 months



Indian Bank 9 months to less than a year



IDBI Bank 500 days



Corporation Bank 12 months



Karnataka Bank 1 year to 2 years



Punjab and Sind Bank 500 days



State Bank of Patiala 999 days



Karur Vysya Bank 1 year to 3 years



Syndicate Bank 250 to 364 days



ICICI Bank 990 days



Indian Overseas Bank 1 year



Federal Bank  1 year



J&K Bank 2 years to less than 3 years



Kotak Bank 700 days



Andhra Bank 1 year



Bank of Baroda 444 days



Vijaya Bank 2 years to less than 3 years



Bank of India 555 days



Canara Bank 1 year



Dena Bank  1 year


I had attempted to create such a list earlier as well but couldn’t keep it current for long, however I’m more optimistic about keeping this list current now because I have all the links in place, and I only look at the highest senior citizen interest rate which makes the process of data gathering a little easier.

Update: Added REPCO bank at 11% and corrected Axis Bank t0 10.40%. Thanks to  Prakash and Sanjay for pointing that out. 

{ 20 comments… read them below or add one }

Vijay October 21, 2011 at 8:06 AM

Manshu, Do you know about the safety of funds if one parks them in ‘Non Nationalised’ banks like TMB,LVB,CUB & even J & K Bank (where the Govt holding is far less) ? And highlight any such banks which one should avoid (red flag) because of past events? Can you have a post which shows the safety of funds in various schemes i.e comparing Nationalised Bank FD’s to Non Nationalised Bank FD’s to Corporate FD’s (with highest rating)…….? I feel that it is all the more pertinent for Senior Citizens as in the eagerness to earn a percent of interest more, they may end up burning their fingers…. and we all will become Senior Citizens one day !!!


Hari October 21, 2011 at 10:02 AM

A very pertinent question, Vijay.
Given that the Deposit Insurance & Credit Guarantee Corporation of India (DICGCI) guarantees only up to a maximum deposit amount of Rs. 1 Lakh (including principal and interest) it would make sense for senior citizens (and even others) to split their deposit amounts between different banks; this will help address both safety and TDS (if any) concerns.

Would appreciate comments from other knowledgeable folks on this.


Manshu October 21, 2011 at 8:11 PM

I think a FD in these banks should be safe, and I can’t actually remember a bank having gone bust (apart from co-operative banks) and people losing money just in deposits. And to tell you frankly, I don’t think I’ll be able to spot any problems in the banks even if they had one, so I don’t know how much I could do.

I guess the way people diversify stocks they can diversify bank fixed deposits also, and open FDs with a few different banks if they have huge sums of money to park in a bank.


krish October 22, 2011 at 7:08 PM

In the last decade, two banks had gone bust — Global Trust Bank which was taken over by OBC and Kerala based Nedungadi Bank which was taken over by PNB. Though technically these sick banks were taken over by other banks thanks to RBI/Govt, it did give a lot of heartache to people who had more than 1 lac as deposits.

I know of a family myself who couldn’t get their deposits out for their daughter’s marriage when Nedungadi Bank was put on freeze and the marriage was cancelled and the bride’s father had a heart attack later!!

If rumors are to be believed, then Dhanlaxmi Bank is presently in a mess and the bank employee union of Kerala has gone on record accusing the management of cooking up the books.

As Hari suggested, Senior Citizens who are very much risk averse should split the deposits — my 5 cents


Vijay October 23, 2011 at 9:25 AM

@Hari,Krish. Precisely ! Although the Management of Dhanalaxmi Bank have gone to great lengths to dispel these rumours, they haven’t cleared the air till now !!! And given the fact that NBFC’s with more than 500 Crore Rs worth of assets and meeting other criteria will be allowed to start their own banks, we will soon witness a lot of them entering the scene and offering very attractive rates !!! Probably Manshu is right in that he doesn’t have any means to ascertain the problems they have, i feel, indirect indicators incl. NPA’s, RBI Circulars (as for Dhanalaxmi Bank recently) would give a clue as to where we should put our money !!! I feel that if one is able to spot a ‘Satyam’ in this sector much before it actually happens, that would benefit a lot of people !!!


Manshu October 25, 2011 at 5:01 AM

There are factors I’m sure and people can look at things like leverage, pledged shares, NPAs, profit margin and other such factors. However, I don’t know that I’ll be able to do this type of forensic accounting or in fact even be able to keep a track of all these factors in so many banks.


Manshu October 25, 2011 at 5:13 AM

What a sad story. I guess when you hear about it in the news the thing becomes already quite late. And I find it hard to believe that an ordinary investor can accurately predict which one is going to go bust. The most practical way is to spread your money around, and not put all eggs in one basket.


Dr.Biju Paul October 21, 2011 at 1:21 PM

Hi Manshu,

Three cheers to you. I commend you on your efforts. It is difficult to get the correct data leave alone updating it as you plan to do !!
I thought I should raise one point. All the banks charge a premature closure fee if the FD is closed before date of maturity (usually 0.5 to 1% ) except I believe IDBI and AXIS bank. This is a very useful feature if you need to close the FD prematurely. I thought you could get the correct list of banks providing this feature and highlight this matter on One Mint.


Manshu October 21, 2011 at 8:04 PM

Excellent point Dr. Paul!

I get a lot of emails from people who close the FD prematurely and are surprised and disappointed to see the rate they got – it appears like a double whammy. That’s because first they are charged the penalty, and then they are given the lower interest rate commensurate with the time period they had their FD open for. So, if someone opened it for 22 months at 11% but broke it in 9 months for which the bank gave only 7% then the bank will adjust the amount to 7% and this is not very apparent to most people.

That’s a good point brought forth by you, and merits a post for sure. Maybe in a couple of weeks – already have the topics for next week in mind 🙂


Saurabh Aggarwal October 22, 2011 at 11:51 AM

Hi , Taminad Mercantile Bank is offering 10.25 % for the period 5 – 10 years , it is really beneficial for senior citizen who have income under 240000 , they can avoid tds by providing form 15 , if interest income exceed Rs.10000 , it takes lot of time to get refund.


Sampath November 11, 2011 at 6:55 PM

Hi, Is REPCO bank fixed deposit is safe? because it is not a bank, a registered cooperative bank and is REPCO bank registers in DICGC for the Guarantee of Rs. 1 lac like other banks.


Navaneeth May 9, 2017 at 4:19 PM

Dear sir,

I want to know about REPCO bank. Is repco bank is safer for fixed deposit? This bank offers 5.75% rate for monthly ( 30 to 45 days) as of now. Is it real?


T.Jagannathan February 10, 2012 at 2:17 PM

Manappuram Finance Ltd offer open ended bonds (can be cashed anytime) at 13% interest and debuntures (5 years) at 14% interest. For Sr citizens the rates are 0.5% more. Is it safe to deposit money in these with this Firm? Kindly advise.


Anbu March 19, 2012 at 3:40 PM

Hello Sir, My dad is a senior citizen and wanted to put Rs 5Lac in FD. Please suggest so that he takes good sum of money after a year or later.
Please give some options.
1. Sort/Long term deposite – Which bank (eg; 2 lac in SBI and 1 Lac in IDBI like that)
2. When to take the money out to get benefited.
3. If they are going to take the interest on monthly basis which option is good.
Please help on this
Thanks in Advance


Sekaran April 21, 2014 at 12:53 PM

Just because you have to maintain the risk at Rs One lakh level you cannot increase your one crore FD into 100 different branches! The Senior citizen depositor will have no time for anything else other than thinking of his deposits and pass sleepless nights with the doctor!
Some reasonable risk has to be taken in whatever manner you deposit your funds. Otherwise invest them in real estate etc! Nobody can trust the banks entirely, which is the reason for limited liability of a bank! Note that you cannot insure your deposits also!


Jayanta Guhathakurta August 1, 2014 at 12:44 PM

I am senior citizen I want deposit as monthly scheme another I want fixe some lumsum.


Manish June 11, 2015 at 9:19 AM

I am 71 years I want to fix deposit 200000 for 2 years what rate of interest I get


K joseph raj December 2, 2015 at 6:41 PM

It is known that the int rate for pensioner loan is at present is 13.35 percent. Why not it is reduced to 8 or 9 percent? This may be consoling to us.will the authorities looj into it?


divakaran kuppusamy July 25, 2016 at 4:03 PM

The interest rates given above for FDs are dead old. Please update them.


subroto Dutta February 6, 2017 at 11:35 PM

Latest rate of time deposit(M I S).


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