Senior Citizen FD in India 2021

Senior Citizen Fixed Deposits (FDs) are term deposit plans with special interest rates offered by leading banks to individuals who are over the age of 60. These fixed deposit accounts offer a wide range of benefits to senior citizens, apart from the additional rate of interest that can go up to 0.50% more than for the general public. The regular interest payout option can help senior citizens get a steady and reliable income stream in their post-retirement years. They can also avail a loan against the FD, if required. The senior citizen FD can also help save tax if it is a 5-year tax saver fixed deposit while also earning additional interest.

Benefits of FD for Senior Citizens

There are a multitude of benefits that can be gained from opening senior citizen fixed deposits, chief among which are:

  • They offer special interest rates which tend to be higher, thereby resulting in more earnings.
  • It creates a safe space for the money to grow in at a steady pace.
  • The interest earned on these deposits can be turned into monthly incomes thus providing more peace in your retirement years.
  • The senior citizen fixed deposit can also be a tax saver deposit which help get tax deductions under section 80C of the IT Act.
  • Senior citizens can choose different interest payout options where interest is credited to the depositors savings account on a frequent basis - either monthly, quarterly, half-yearly or yearly.
  • Regular interest payout option can be a boon for those who are retired because it acts as a source of supplementary income.

Senior Citizen FD Interest Rates

Below are the 12 Best Senior Citizens Fixed Deposit rates offered by banks in India as of April 2021.
Senior Citizen FD Rates 2021
Bank 1 to 5 years Above 5 years
IDFC First Bank 2.75% to 5.75% 5.75%
Repco Bank 4.25% to 6.25% -
Tamilnad Mercantile Bank 3.50% to 5.75% 5.50%
DCB Bank 4.25% to 6.75% 6.75%
Lakshmi Vilas Bank 2.50% to 6.00% 5.50%
Yes Bank 3.50% to 6.75% 6.75%
Deutsche Bank 1.80% to 6.25% -
Karur Vysya Bank 3.50% to 5.65% 5.75%
Bandhan Bank 3.00% to 5.75% 5.50%
IDBI 2.90% to 5.10% 4.80% to 5.60%
IndusInd Bank 3.00% to 6.50% 6.25%

*Interest rates are subject to change and can be revised by the bank without prior notice.

Top Bank Senior Citizen FD Rates

Senior Citizen Best FD Rates 2021
Fixed Deposits with Bank Less than 1 year 1 to 5 years More than 5 years
SBI 2.90% p.a. to 4.90% p.a. 4.90% p.a. to 5.30% p.a. 5.40% p.a.
HDFC Bank 3.00% p.a. to 4.90% p.a. 5.40% p.a. to 5.80% p.a. 6.25% p.a.
Canara Bank 2.95% p.a.to 4.95% p.a. 5.70% p.a. to 6.00% p.a. 6.00% p.a.
ICICI Bank 3.00% p.a. to 4.90% p.a. 5.40% p.a. to 5.85% p.a. 6.30%
HSBC Bank 2.75% p.a. to 3.60% p.a. 3.60% p.a. to 4.50% p.a. -

*Interest rates are subject to change and can be revised by the bank without prior notice.

Eligibility for Senior Citizen FD

If you want to open a senior citizen fixed deposit, then you will need to be a resident of India. NRI senior citizens too can open these FDs through NRE or NRO accounts. You also need to be above the age of 60 years at the time of opening the fixed deposit.

  • The depositor must have crossed 60 years of age on the date on which he/she opens the respective term deposit account
  • Some banks may allow customers who are more than 55 years and have taken early retirement to apply for this type of FD scheme. This rule may vary from bank to bank and are subject to certain terms and conditions

Documents required for opening Senior Citizen FD

  • Age proof document
  • Passport
  • Aadhaar Card
  • PAN card
  • Photograph

Features of Senior Citizen Fixed Deposit

The features of the senior citizen fixed deposits remain the same as regular term deposits. Some of these features are listed below.

  • These fixed deposits also offer deposit tenures ranging from 7 days to 10 years depending on the bank.
  • Nomination facilities are also available on these deposits where depositors can declare a person
  • The interest rates offered under these schemes are decided based on the duration of the term deposit.
  • The interest earned is compounded on a quarterly basis and can be credited to an account or added to the maturity value of the FD.
  • Once created, the fixed deposit can be closed prematurely at any time. Such a premature withdrawal is not possible with tax saver FDs and may attract penalties with regular FD based on the bank's rules.
  • The limits for the amounts that can be deposited under these schemes can range from Rs. 1 crore to higher amounts. These limits will be decided by banks and may vary from one bank to the next.
  • Some of these deposits can even be tax saver fixed deposits which come with lock in periods of 5 years and still offer the special interest rates to senior.

Taxes on Senior Citizen FDs

The interest earned on senior citizen fixed deposits may be liable for income tax based on the applicable laws. These taxes, if any, are deducted at the source however, in case you are not liable to pay taxes you can submit forms 15G or 15H to the banks.

If the term deposit is an NRE deposit then it may not be liable for taxes however in the case of NRO and FCNR deposits interest earned may be liable for taxes.

Benefits of FD for Senior Citizens

There are a multitude of benefits that can be gained from opening senior citizen fixed deposits, chief among which are:

  • They offer special interest rates which tend to be higher, thereby resulting in more earnings.
  • It creates a safe space for the money to grow in at a steady pace.
  • The interest earned on these deposits can be turned into monthly incomes thus providing more peace in your retirement years.
  • The senior citizen fixed deposit can also be a tax saver deposit which help get tax deductions under section 80C of the IT Act.
  • Senior citizens can choose different interest payout options where interest is credited to the depositors savings account on a frequent basis - either monthly, quarterly, half-yearly or yearly.
  • Regular interest payout option can be a boon for those who are retired because it acts as a source of supplementary income

FAQs on Senior Citizen Fixed Deposit

  1. Do senior citizens have to pay TDS for fixed deposits?

    As a senior citizen, you will have to pay TDS (Tax Deducted at Source) only when the combined interest for all the fixed deposits you hold in a specific customer ID with the bank exceeds Rs.50,000 in a financial year.

  2. Can a senior citizen open a fixed deposit account jointly with a person who is not a senior citizen?

    Yes, a senior citizen can open a joint fixed deposit account with an individual who is not a senior citizen. However, if it is a special senior citizen fixed deposit scheme, then the first or primary account holder should be the senior citizen.

  3. If a senior citizen wants to open a second or third fixed deposit account with the bank, is proof of age required again?

    Yes, each time a fixed deposit account is opened, proof of age has to be furnished and submitted to the bank.

  4. Do bulk fixed deposits have additional interest rate for senior citizens?

    This would depend on the financial institution, but mostly, bulk deposits (above Rs.2 crore or less, depending on the bank) do not have preferential or additional rate of interest for senior citizens.

  5. Are super-senior citizens offered additional rate of interest for fixed deposits?

    Depending on the bank or NBFC, super-senior citizens (those who are above 80 years of age) are provided with additional interest rates over and above that which is provided to senior citizens (from the age of 60 to 80).

News About Senior Citizen Fixed Deposits

  • Senior citizens special fixed deposit extended by HDFC Bank

    The senior citizen special fixed deposit scheme will be extended till 18 May 2020 as per HDFC Bank. The extension was applied for the third time. The bank offers an additional 75 basis points over the regular FD interest rates for citizens.

    The rate of interest offered is 6.25% and has been applicable since 13 November 2020. Senior citizens receive an additional 50 bps on the interest rate for regular citizens. With the senior citizens special FD scheme, they are entitled to an added interest rate of 25 bps.

    29 March 2021

  • FD Scheme for Senior Citizens extended by ICICI Bank and HDFC Bank till 31 March 2021

    Indian lenders HDFC Bank and ICICI Bank have extended the fixed deposit schemes for senior citizens till 31 March 2021. The FD scheme was introduced in May 2020 to secure the interest of individuals aged 60 years and above since the interest rates were falling rapidly due to the financial implications caused by Covid-19.

    The ICICI Bank Golden Years scheme offers 80 bps higher interest rate where the senior citizen will earn interest on their deposits at 6.30% p.a. Similarly, the HDFC Senior Citizen Care offered by HDFC Bank is offering 75 bps higher interest on deposits for senior citizen. The senior citizen on opening an FD account with the lender will earn an interest at the rate of 6.25% p.a.

    05 January 2021

  • Senior Citizen Special FD scheme to end in December 2020

    Many banks such as the State Bank of India, ICICI Bank, HDFC Bank and Bank of Baroda have been offering additional interest on fixed deposits for senior citizens. This Senior Citizen Special FD scheme was being offered since May 2020 due to the COVID-19 pandemic.

    The scheme was introduced and was previously applicable until 30 September 2020. However, it was then extended to 31 December 2020. Among all the banks, only the State Bank of India has extended this scheme until 31 March 2021. However, for the other banks, this scheme will be ending on 31 December 2020.

    31 December 2020

  • Fixed Deposit Rates for Senior Citizens over 9%

    Many banks in the country like ICICI Bank, State Bank of India (SBI), and HDFC Bank offer 50 basis point extra for senior citizens on their fixed deposits (FDs). Small Finance Banks (SFBs) offer higher interest rates on FDs to senior citizens. The interest rates on fixed deposits have been decreasing in the recent times. However, the SFBs are offering a higher rate as compared to a few banks. The FDs with maturity period 7 days to 45 days will earn 4% and those of 46 days to 90 days will fetch 4.5%. For 91 days to 180 days and 181 days to 364 days, you will get 5 % and 7% interest rates respectively if you are a senior citizen. For deposits maturing in one year to 699 days, the interest is 8.25%. The bank offers 8.5% on deposits of 700 days. For all FDs maturing in 701 days to 3652 Days, you will get 7.75%.

    03 August 2020

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