Bank fixed deposits remain the preferred investment option for risk-averse investors seeking stable returns, with rates generally ranging between 6% and 7.25% per annum as of May 2026. However, recent reports highlight that FD interest rates have fallen to just 3% in some cases, making traditional fixed deposits less attractive to investors. According to reports from Mint, NBFCs and small finance banks offer higher interest rates, reaching up to 8.30% per annum for general depositors and 8.80% for senior citizens. However, these higher yields come with increased risk compared to traditional public-sector and major private banks.
Post Office Time Deposits offer sovereign guarantee with fixed tenures ranging from 1 to 5 years. As reported by Mint, the scheme provides interest rates of 6.9% per annum for 1-year deposits, 7% per annum for 2-year deposits, 7.1% per annum for 3-year deposits, and 7.5% per annum for 5-year deposits. The minimum deposit is ₹1,000 with no upper limit, and the scheme qualifies for tax deduction under Section 80C. However, interest rates remain uniform across all categories without senior citizen benefits.
The Senior Citizens Savings Scheme currently provides 8.2% per annum interest rates with a minimum deposit of ₹1,000 in multiples of ₹1,000. According to Mint, the scheme allows maximum total investment of ₹30 lakh per individual and offers tax deduction of up to ₹1.5 lakh per financial year under Section 80C. The scheme requires individuals to be 60 years or older, with eligibility extending to 55-60 year olds who have retired under superannuation schemes. Retired defence personnel can invest from age 50.
The National Savings Certificate offers 7.7% per annum interest for April-June 2026 quarter deposits with a minimum investment of ₹1,000. As reported by Mint, the scheme allows additional deposits in multiples of ₹100 with no maximum limit, featuring a 5-year maturity period with annual interest reinvestment until the fourth year. The scheme provides tax deduction of up to ₹1.5 lakh per financial year under Section 80C for old tax regime.
The Sukanya Samriddhi Yojana offers 8.2% per annum interest rates specifically for female children under 10 years of age. According to Mint, the scheme requires minimum deposit of ₹250 with maximum annual investment of ₹1.5 lakh, maturing after 21 years or upon marriage after age 18. The scheme provides triple tax benefits under EEE category, making all investment, interest, and maturity proceeds completely tax-free. The account can be opened at Post Offices or with various lenders.
