{"id":7799,"date":"2026-05-09T09:39:48","date_gmt":"2026-05-09T01:39:48","guid":{"rendered":"http:\/\/longzhuplatform.com\/?p=7799"},"modified":"2026-05-09T09:39:48","modified_gmt":"2026-05-09T01:39:48","slug":"want-over-9-fd-returns-these-small-finance-banks-offer-up-to-9-1-interest","status":"publish","type":"post","link":"http:\/\/longzhuplatform.com\/?p=7799","title":{"rendered":"Want over 9% FD returns? These small finance banks offer up to 9.1% interest"},"content":{"rendered":"

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Fixed deposit (FD) interest rates across Indian banks continue to remain attractive for savers in May 2026, with returns ranging from 2.5% to as high as 9.1% annually depending on the bank, tenure, and customer category.<\/p>

While large public and private sector banks are offering FD rates largely in the 6% to 7.5% range, small finance banks (SFBs) are continuing to offer significantly higher returns to attract deposits. Senior citizens are also benefiting from additional interest of 0.20% to 0.50% above regular rates.<\/p>

The current FD landscape reflects a competitive deposit market as banks continue to mobilise retail deposits amid steady credit demand and evolving liquidity conditions.<\/p>

Public banks vs private banks vs SFBs<\/strong><\/p>

Among public sector banks, Bank of India and Punjab National Bank are offering up to 6.6% for regular customers on select tenures, while State Bank of India and Bank of Baroda are offering rates up to around 6.45%. Senior citizen rates at these banks are largely ranging between 7% and 7.1%.<\/p>

Private sector banks are offering relatively higher rates in some tenures. Bandhan Bank is offering up to 7.25% for regular customers and 7.75% for senior citizens on select deposits. Federal Bank is offering rates up to 6.75% for regular customers and 7.25% for senior citizens, while Axis Bank\u2019s rates go up to 6.45% for regular depositors and 7.2% for seniors.<\/p>

However, the highest rates continue to come from small finance banks. Several SFBs are offering rates between 8% and 9.1%, especially on medium-term deposits. Senior citizen returns at some smaller banks are crossing 9%, making them among the most attractive fixed-income products currently available in the banking system.<\/p>

Saurabh Jain, Co-founder and CEO of Stable Money, said smaller banks are continuing to use competitive pricing to strengthen retail deposit mobilisation.<\/p>

\u201cSmall finance banks continue to offer relatively higher interest rates compared to larger peers, with senior citizens currently seeing rates in the 8.25%\u20138.3% range and general investors around 8.1%. This reflects a broader trend where smaller banks are using competitive pricing to attract stable retail deposits,\u201d Jain said.<\/p>

\u201cAnother notable trend is the emergence of the 1.5\u20133 year tenure bracket as a preferred sweet spot for investors. It allows individuals to lock in relatively higher rates for a reasonable duration without overcommitting in what remains an evolving interest rate cycle.\u201d<\/p>

<\/article> <\/article>

Focus on SFBs<\/strong><\/p>

He added that banks such as Utkarsh, Suryoday, and Shivalik have maintained relatively stable deposit rates, helping investors gain familiarity and comfort with fixed-income products over time.<\/p>

\u201cFor instance, associations like Utkarsh Bank\u2019s partnership with Mumbai Indians during the ongoing T20 season indicate a growing push towards retail participation in fixed-income products,\u201d he said.<\/p>

Jain also cautioned investors to balance returns with safety considerations.<\/p>

\u201cFixed deposits remain one of the more predictable investment avenues, and with DICGC insurance coverage of up to \u20b95 lakh per depositor per bank, they continue to serve as a dependable component of a diversified portfolio focused on capital preservation and steady income,\u201d he added.<\/p>

Financial planners say many investors are currently preferring medium-term FDs as expectations grow that interest rates could gradually soften over the next 12\u201318 months if liquidity conditions improve further.<\/p>

At present, the one-year to three-year tenure segment remains the sweet spot for FD investors seeking higher returns with relatively lower duration risk.<\/p> <\/div>

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Fixed deposit (FD) interest rates across Indian banks continue to remain attractive for savers in May 2026, with returns ranging from 2.5% to as high as 9.1% annually depending on the bank, tenure, and customer category. While large public and private sector banks are offering FD rates largely in the 6% to 7.5% range, small […]<\/p>\n","protected":false},"author":1,"featured_media":7800,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[37],"tags":[10177,28912,28908,28907,4224,28913,28910,28906,1121,6532,2293,28909,28911,73,27517,28914],"class_list":["post-7799","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-content-marketing","tag-banks","tag-banks-offering-9-percent-fd","tag-best-fixed-deposit-rates","tag-fd-interest-rates-may-2026","tag-finance","tag-fixed-deposit-investment-india","tag-high-return-fixed-deposits","tag-highest-fd-rates-india","tag-interest","tag-offer","tag-returns","tag-senior-citizen-fd-rates","tag-sfb-fd-interest-rates","tag-small","tag-small-finance-bank-fd-rates","tag-top-fd-schemes-2026"],"acf":[],"_links":{"self":[{"href":"http:\/\/longzhuplatform.com\/index.php?rest_route=\/wp\/v2\/posts\/7799","targetHints":{"allow":["GET"]}}],"collection":[{"href":"http:\/\/longzhuplatform.com\/index.php?rest_route=\/wp\/v2\/posts"}],"about":[{"href":"http:\/\/longzhuplatform.com\/index.php?rest_route=\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"http:\/\/longzhuplatform.com\/index.php?rest_route=\/wp\/v2\/users\/1"}],"replies":[{"embeddable":true,"href":"http:\/\/longzhuplatform.com\/index.php?rest_route=%2Fwp%2Fv2%2Fcomments&post=7799"}],"version-history":[{"count":0,"href":"http:\/\/longzhuplatform.com\/index.php?rest_route=\/wp\/v2\/posts\/7799\/revisions"}],"wp:featuredmedia":[{"embeddable":true,"href":"http:\/\/longzhuplatform.com\/index.php?rest_route=\/wp\/v2\/media\/7800"}],"wp:attachment":[{"href":"http:\/\/longzhuplatform.com\/index.php?rest_route=%2Fwp%2Fv2%2Fmedia&parent=7799"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"http:\/\/longzhuplatform.com\/index.php?rest_route=%2Fwp%2Fv2%2Fcategories&post=7799"},{"taxonomy":"post_tag","embeddable":true,"href":"http:\/\/longzhuplatform.com\/index.php?rest_route=%2Fwp%2Fv2%2Ftags&post=7799"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}