If you are looking for a fixed deposit that offers attractive returns, Utkarsh Small Finance Bank’s special 666-day FD may catch your attention.
The bank is offering interest rates of up to 8.25% per year on this special FD. The rate is higher for senior citizens, while regular customers can earn 8.10% interest.
For example, a ₹5 lakh investment could earn interest of around ₹80,338 for a senior citizen by the end of the tenure.
Let’s look at the complete calculation.
666-Day FD Offers Up to 8.25% Interest
Utkarsh Small Finance Bank is offering these rates on callable bulk deposits of less than ₹3 crore, effective from May 5.
Regular customers: 8.10% annual interest
Senior citizens: 8.25% annual interest
Senior citizens get an additional 0.15 percentage point (15 basis points) over the regular interest rate.
₹5 Lakh FD: How Much Will You Earn?
The returns on a ₹5 lakh investment depend on whether the depositor is a regular customer or a senior citizen.
For Senior Citizens
If a senior citizen invests ₹5 lakh for 666 days at an interest rate of 8.25%, the estimated maturity amount is around ₹5,80,338.
That means the estimated interest earned would be approximately ₹80,338.
For Regular Customers
For a regular customer, the same ₹5 lakh investment at 8.10% interest could grow to around ₹5,78,784 after 666 days.
The estimated interest earned would be approximately ₹78,784.
₹5 Lakh FD Calculation at a Glance
| Category | Interest Rate | Approx. Maturity Amount | Approx. Interest |
|---|---|---|---|
| Senior Citizen | 8.25% | ₹5,80,338 | ₹80,338 |
| Regular Customer | 8.10% | ₹5,78,784 | ₹78,784 |
The actual maturity amount can vary depending on the bank’s applicable FD calculation and payout terms.
Don’t Forget TDS on FD Interest
Before investing, remember that FD interest is not completely tax-free.
TDS may apply to the interest earned from your fixed deposit as per applicable income-tax rules.
Therefore, the amount you finally receive after tax deductions may be lower than the gross maturity amount.
It is also important to check the bank’s rules regarding premature withdrawal before opening the FD.
Is This FD Worth Considering?
An interest rate of up to 8.25% can look attractive, especially for investors who prefer fixed-income products.
However, the interest rate should not be the only factor you consider. Check the applicable TDS, premature withdrawal rules and other FD terms before investing.
Also, remember that the deposit insurance limit and eligibility rules applicable to bank deposits should be considered when deciding how much money to keep with any one bank.