Fixed Deposit is a perfect way to expand your investments with the utmost security as an investing vehicle provided by banks and NBFCs (non-banking financial companies). It is one of the most common investment avenues that allow you to deposit with your bank a lump sum amount and choose a tenure according to your convenience. Your investment begins to receive interest on completion of the pre-decided term, over the selected length, as per the rate of interest at which you locked in your investment.
It is untouched by further increases in interest rates or price volatility once the investment balance has been locked in at a certain interest rate. Therefore, with your deposit investment, you can get fixed returns, and you can opt to get your interest monthly, or at maturity. The defining condition for FD is usually that the money should not be removed until maturity, but after paying penalty charges, you are allowed to withdraw it.
What is a Senior citizen special fixed Deposit (FD) scheme?
Why Fixed Deposits investment is a good option for senior citizens?
Usually, fixed deposit issuers give senior citizens a higher interest rate relative to traditional investment plans. E.g., the State Bank of India, one of India’s reputable banks, provides an extra 0.50 percent interest on fixed deposits for senior citizens, which for chosen tenures amounts to up to 6.20 percent.
There are a few Special fixed deposit (FD) schemes for senior citizens offered by the State Bank of India (SBI), Bank of India, IDBI and HDFC Bank. Senior citizens obtain additional interest rates above the current rates available to them under this special FD programme. In general, banks offer higher rates of interest for senior citizens relative to others. Let’s take a look at the interest rates offered by SBI, Bank of India, IDBI and HDFC Bank for the special FD scheme for senior citizens.
Features of SBI special FD scheme for senior citizens
- The SBI has announced a Special SBI FD scheme for senior citizens known as ‘SBI We Care’.
- New SBI FD rates: 80 bps higher
- SBI FD rates: If a senior citizen positions a fixed deposit under the special FD programme, 6.20 percent would be the interest rate applied to the FD. Those rates are applicable as of 27 May.
- FD Tenure: 5 years and above
- Scheme valid Period: The scheme is valid till 30 September 2020
Features of IDBI Bank special FD scheme for senior citizens
- IDBI has announced a special FD scheme for senior citizens known as IDBI Naman Senior Citizen Deposit.
- Benefits of the FD Scheme: For a fixed time over and above the current additional rate of 0.50 percent per annum, resident senior citizen clients will receive an additional interest rate of 0.10 percent on their fixed deposit investments.
- The FD Term ranges from 3 years up to 7 years.
- Scheme Period Validity: The scheme is valid till 30 September 2020
- Scheme Cover: Fresh deposits opened and deposits renewed over the scheme period would be eligible for the additional rate value.
- New interest offered: 60 bps higher.
- IDBI FD Interest Rate: 6%
Features of the Bank of India special FD scheme for senior citizens
- Bank of India announced a special fixed deposit scheme for senior citizens.
- New interest offered: 75 bps.
- Fixed Deposit term: ‘5 Years and above.’
- Senior citizens will be paid an additional premium of 25 bps, above the existing 50 bps on their retail TD (Less than ₹ 2 Cr) for ‘5 Years and above’ tenor only, i.e. 75bps.
- Bank of India Interest rate: 6%
Features of HDFC Bank special FD scheme for senior citizens
- The bank is offering HDFC FD scheme for senior citizens called HDFC Senior Citizen Care.
- New interest offered: 75 bps higher.
- HDFC FD Interest rate: Senior citizens placing their fixed deposit investment under HDFC Bank Senior Citizen Care FD scheme will avail the interest rate of 6.25%. An extra 25 bps premium will be payable to senior citizens under this new offering. These prices apply from 12 June onwards.
- FD term: 5 years and above
- The FD Scheme is available until 30 September 2020
Conclusion: Senior citizens trying to gain a competitive interest rate without taking any chances and have surplus capital to save for a very long term, choosing FD investment is a smart choice. It is one of the market’s safest investing options. Go on to select these special FD rates offered by SBI, Bank of India, IDBI, and HDFC bank for senior citizens in the falling rates regime.
