Fixed Deposits(FD) Interest Rates
- 21 Comment
Introduction
In this article I am looking into the term fixed deposit. As many people aware of the term and they already investing on the fixed deposit, this blog might be useful for those who are not familiar with the term or just getting into the financial planning for the future savings and investment. I hope you will enjoy this article. Don’t forget to leave the comments after reading this article. Subscribe to our future articles here.
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What is Fixed Deposits(FD)?
Fixed Deposits (FD) is a system where a person – known as a depositor – deposits a lump sum amount of money in bank at a predetermined fixed period. The longer the period of the fixed deposit, the higher is the interest rate the depositor earns. The number of days an amount may be entered into a fixed deposit scheme ranges from 15 days to 5 years. After maturity period of the fixed deposit, the depositor then acquires the lump sum amount equal to his principal deposit, plus interest thereon.
The Reserve Bank of India(RBI) ensures an effective policy and restriction for the safety of these bank fixed deposits. Interest rates on fixed deposits differ from various banks depending on the maturity periods and the amount of deposits. The amount of fixed deposits range from Rs.10 to as high as 100 million rupees. Interest rates for bank fixed deposits are dependent on the amount of the investment and its maturity period which ranges from 4 to 10 percent. (Effective October 1st 2008, State Bank of India (SBI) offers 10.5% for normal FD and 11% for the senior citizen). Below is a presentation of the interest rate a fixed deposit can yield for a given period of maturity: These rates taken while writing this article. Period of Maturity Annual Interest Rate (in percent)
Interest Rates for Fixed Deposits(FD)
- 15 – 29 days 4.00%
- 30 – 45 days 4.75%
- 46 – 90 days 5.25%
- 91 – 120 days 6.00%
- 121 – 180days 8.00%
- 181 – 364 days 8.50%
- 1 year – not more than 2 years 9.00%
- 2 years – not more than 3 years 9.25%
- 3 years – not more than 5 years 9.50%
- Above five years 10.00%
Summary
All bank deposits in India are covered with insurance by the Deposit Insurance and Credit Guarantee Scheme of India and is, therefore, considered to be the safest investment form a depositor or investor can work on. Opening a Fixed Deposit Account is like opening a savings account after complying with the requirements where a deposit receipt is given to the depositor and is subject to updating within the period of the fixed deposit. It is necessary to update the account to verify if all transactions have been accounted for correctly.
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21 Comments on this post
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Anonymous said:
If Indian banks go bankrupt, am I insured?
1. If Indian banks ( both nationalised state banks and private Citibank,ICICI) go bankrupt, how much amount will I be insured for as per RBI ?
Are term deposits insured too? ( upto wht amount)?2. Since this is India, does RBI have any laws for limiting time period to recover the money ?
October 8th, 2008 at 4:24 am -
krishnas said:
HI,
Thank you for the comments. RBI doesn’t insure any of the investment in the private banks. That means if ICICI or HDFC go bankrupt, government will not try for the bailout like what happened in the USA. But, in the case of nationalized banks like SBI,IOB,etc. RBI gives 100% insurance for the money you have invested. you need not worry about you money. It will be returned without any problem.
If you have any more doubts, please reply to this comment.
October 8th, 2008 at 7:28 am -
Rohit said:
hi..
i was planning to invest money as Fixed deposit in ICICI bank. Considering the market is so volatile and unsafe…..is my FD insured and safe in Nationalised banks like SBI etc..rather than private banks like ICICI…citibank..
please comment
thanks
rohitOctober 22nd, 2008 at 8:13 pm -
vikash agarwal said:
i am planning to invest Rs.190000.00 as fixed deposit in any of the
nationalised bank ,if in future that bank goes bankrupt then is my investment insured by any govt. institute?October 31st, 2008 at 8:33 am -
ranjan said:
i am planning to invest in SBI tax savings – like ( NSC) .. need clarification on this …
Comment given above:
After maturity period of the fixed deposit, the depositor then acquires the lump sum amount equal to his principal deposit, plus interest thereon.INVEST AMOUNT: 5000
after 5 years can i get 10000 ??? is it taxable count while investment ???every month i pay 5000 for five years, after 5 years i can get 10000 for first investment i take 5000 and again investing 5000. so next five years i will take 5000 for every month .. is it good idea to invest ???
November 10th, 2008 at 4:06 am -
A.V.SUBBA RAO said:
sir, I want to download sbi fixed deposit application form
November 26th, 2008 at 7:34 am -
krishnas said:
You can find the details in SBI’s website http://sbi.co.in/
November 27th, 2008 at 6:15 am -
Sanjay said:
Even deposits in many private banks are also insured.
Please visit:
http://www.investchips.com/2008/09/is-our-money-in-icici-bak-safe.html
November 29th, 2008 at 7:05 am -
ravi Srivastava said:
i wants to know ther name of nationalised indian bank who have highest rates of fixed deposite in india and situated in district deoria in uttarpradesh
February 2nd, 2009 at 12:13 am -
krishnas said:
@Ravi,
You can go for any of the nationalized banks like SBI or IOB. But, how ever the FD rates are drcreased now and you can get it around 8% to 9%February 2nd, 2009 at 12:30 am -
Archana said:
quite informative blog
February 10th, 2009 at 2:41 am -
vijay said:
In the month of October 09, i was planning to buy a flat in Bangalore, but due to world recession i have postponed my plans. Please let me know when should i buy it now???
VP
February 21st, 2009 at 9:59 pm -
Sonu said:
Is BOB well postioned
February 25th, 2009 at 8:09 pm -
Bharat Parmar said:
To inform the rate of interest is always fluctuating with the banks. I have seen and helped many by giving correct information and helping people getting more returns on their money. The bet would be that the money is invested in the post office as their rate of interest is constant and the amount is guaranteed with the bonus given by them. Well if you would like more details any one can contact me on 9822197058 or 9421035614 as I am well associated with one of the NGO and I can help grow your money in folds without risk. I am registered license holder from the collector’s office for circulating government schemes and driving the launch. My family has served for 25 years in Pune market for most of the schemes and has successfully helped people. Any questions you can email me at bp7778@gmail.com or on the above phone numbers.
April 12th, 2009 at 1:19 am -
krishnam raju said:
the people who are planning to invest in the fixed depoists can contact me as i am having the best policy with me which will add value to your money. with good returns. feel free to contact me.
09962779666. mail id is nvrkraju.nag@gmail.com.April 28th, 2009 at 3:40 am -
Sanjay Thakur said:
It’s too old rate .
Pl. update it and than exact comments to be put here.April 20th, 2010 at 2:25 am -
VARINA NATHANI said:
Hi,
Would like to know how much amount can be safely invested in Fixed Deposit in Scheduled Banks, Cooperative Banks, Public and Private Sector Banks. What is DICGS? How much is the risk covered if money is invested in Fixed Deposit in these banks.
June 16th, 2010 at 8:50 am -
aditi said:
i have kept fd with co-operative bank, of almost Rs.100000/-, but its with different branchs, while calculating interest p.a. will they count interest on all F.D. with other branches?
July 14th, 2010 at 10:07 am -
aditi said:
i have kept fd with co-operative bank, of almost Rs.100000/-, but its with different branchs, while calculating interest p.a. will they count interest on all F.D. with other branches?& deduct TDS on it?
July 14th, 2010 at 10:08 am -
Tejal said:
Interest rates are too old, Request to keep upto-date information then only it will be useful !!!
August 21st, 2010 at 10:33 pm -
shirish Tamhane said:
I am Senior Citizen, If, I deposit certain amount in different banks or even one bank by which I am getting total interest of Rs. 45000 p/a. I do not have any other income since I am retired, will TDS be deducted from my above income, if yes, then Senior citizen is entitled for income tax if his income goes above Rs. 2,25000/- how can we link this with above interest (income).
Please guide me,
Thanks,September 2nd, 2010 at 4:56 am
