Investment Minister: Last chance to get high interest on fixed deposits

New Delhi| RBI had reduced the repo rate by 0.25 percent in February after two years. Since then, banks had kept the interest rates on both loans and deposits the same for about a month. However, now interest rates on loans and deposits have started decreasing. Despite this, many banks are still offering high interest rates on deposits. In such a situation, if you want to deposit money safely and at good interest in this huge fall of the market, then this is probably the last chance. Many banks are offering interest ranging from 7 to 9 per cent. Senior citizens are getting even more interest than this.

Bandhan Bank is currently offering 8.05 per cent interest on one-year FDs. IndusInd Bank is offering 7.75 per cent interest for the same period. While Yes Bank is giving 7.75 per cent, RBL Bank is also doing FD at the same rate. Karnataka Bank is offering 7.25 per cent interest. DCB Bank is offering the lowest interest of these at 7.1 per cent. HDFC Bank is offering 7.4 per cent, ICICI Bank 7.25 per cent, Kotak Mahindra 7.4 per cent and Federal Bank 7.5 per cent interest on different tenures. Senior citizens are getting 0.50 per cent more. SBI has an interest rate of 7 to 7.5 per cent, Bank of Baroda 7.15 per cent and Union Bank 7.30 per cent.

In the long term, a 0.50 per cent difference in interest rates could increase interest income substantially. If your total FD amount is 10 lakhs and a bank is paying 0.50% more interest then it means that you can earn an extra 5,000 rupees a year.

Overdraft facility can be availed on FD
You can avail overdraft facility against FD. Most banks give overdrafts of 70 per cent compared to FD amounts. Example- If the FD is worth 5 lakhs and the bank is offering overdraft facility up to 70 per cent then you can get a credit limit of up to 3.5 lakhs.

Overdraft facility is also renewed on renewal of FD. Therefore, there is no need to re-document process to avail the overdraft facility. Investment advisor Archana Pandey said that those who want to get safe and decent interest in the current environment of uncertainty can currently FD their money for one year.