Question 1

Which bank gives the highest interest rate on FD in 2026?

Accepted Answer

As of early 2026, Small Finance Banks like Unity Small Finance Bank, Suryoday, and Utkarsh are often offering the highest interest rates, sometimes going up to 9.00% or more for specific tenures, especially for senior citizens. It's always best to check our regularly updated table for the latest numbers.

Question 2

Are FDs in Small Finance Banks safe?

Accepted Answer

Yes. All banks, including Small Finance Banks, are regulated by the RBI. Your deposits are insured by DICGC (an RBI subsidiary) for up to ₹5 lakh per depositor, per bank. This makes investing up to ₹5 lakh in these banks as safe as any large public or private bank.

Question 3

What is the difference between General and Senior Citizen rates?

Accepted Answer

Banks in India offer a higher interest rate to senior citizens (individuals aged 60 and above) as a benefit. This additional rate is typically 0.50% per annum higher than the rate offered to the general public.

Question 4

Is the interest earned on FDs taxable?

Accepted Answer

Yes, the interest earned from an FD is fully taxable. It is added to your total income under 'Income from Other Sources' and taxed as per your income tax slab. Banks also deduct TDS if the interest income in a year exceeds ₹40,000 (₹50,000 for senior citizens).

Tenure	General Rate	Senior Citizen
390 Days	7.40%	7.90%
23 Months	7.30%	7.80%
365 Days to 389 Days	7.10%	7.60%
2 Years to < 3 Years	7.15%	7.65%
5 Years	6.20%	6.70%

Frequently Asked Questions

Which bank gives the highest interest rate on FD in 2026?

Are FDs in Small Finance Banks safe?

What is the difference between General and Senior Citizen rates?

Is the interest earned on FDs taxable?