Several banks, both private and government have hiked deposit interest rates of various tenures. This is great news for risk-averse individuals who have been stuck with decadal low-interest rates due to continuous reduction in banks’ rates in recent years.
At the same time, a fixed-income option many turned to during this time was small saving schemes like the post office tern deposits (POTD). No changes have been made in the interest rates of post office small savings schemes as of now, due to which they earn higher rates compared to bank fixed deposits.
HDFC Bank has raised the interest rate by 5-10 basis points on fixed deposits worth less than Rs 2 crore. The bank has increased the 1-year FD interest rate by 10 basis points to 5% from 4.9 percent and 3 years to 5 years by 5 basis points 5.45 percent. The State Bank of India has increased interest on FDs for tenures above 2 years by 10-15 basis points. For 3 – 5 years, the interest rate is increased by 15 basis points to 5.45 percent.
