Bank FD Scheme : Fixed Deposits (FDs) remain one of the most popular investment choices among Indian individuals, and with good reason. When you place your money in a bank FD, you invest it for a fixed term and receive a guaranteed return, making it an attractive and reliable option—especially for those seeking safety along with modest yields. While FDs are available across various tenures, the one-year FD is particularly favored, offering a blend of liquidity, predictability, and decent returns.
Bank FD Scheme : Why One-Year FDs are a Preferred Choice
There are several compelling reasons for the popularity of one-year fixed deposits:
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Guaranteed and Stable Returns
One-year FDs offer investors certainty—knowing exactly how much they will earn at maturity. -
Short to Medium-Term Commitment
A one-year horizon is neither too short nor too long, striking the right balance between liquidity and returns. -
Comparative Benchmarks
The one-year FD rate often serves as a benchmark to evaluate other investment products, making it a convenient comparison point. -
Accessibility and Familiarity
Most banks offer hassle-free FD accounts with minimal paperwork, making them easily accessible to the general public.
Bank FD Scheme : One-Year Fixed Deposit Rates: Private vs. Public Sector Banks
Here is a breakdown of current one-year FD interest rates offered by both private and public sector banks, based on the latest available data:
Private Banks
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IndusInd Bank: Among private banks, IndusInd stands out with a one-year FD rate of 7.75%, though this applies to certain instruments like Certificates of Deposit rather than standard retail FDs.
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HDFC Bank: As of mid‑2025, HDFC has reduced FD rates by up to 25 basis points for tenures under ₹3 crore. Previously, some tenures offered rates up to 7.35% for senior citizens, but regular one-year FD rates are now lower—typically around 6.6% or slightly less.
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ICICI Bank, Axis Bank, and Kotak Mahindra Bank: These private banks currently offer maximum one-year FD rates in the vicinity of 6.6%, with slight variations depending on promotions or senior citizen rates.
Public Sector Banks
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Bank of Baroda, Punjab National Bank (PNB), and Union Bank of India: These banks offer one-year FD interest rates around 6.6%.
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Canara Bank: Offers slightly lower one-year FD rates at 6.5%.
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State Bank of India (SBI): The largest public sector bank provides a one-year FD rate of approximately 6.45%, with slightly higher rates (around 6.6%) for specific tenures like 444 days.
Bank FD Scheme : Comprehensive Comparison Table
Here’s a quick comparison of the current one-year FD rates across various banks:
| Bank Type | Bank Name | Approx. One-Year FD Rate |
|---|---|---|
| Private Bank | IndusInd Bank (CDs) | ~7.75% |
| Private Bank | HDFC Bank | ~6.6% (regular), 7.35% (senior) |
| Private Bank | ICICI Bank | ~6.6% |
| Private Bank | Axis Bank, Kotak Mahindra Bank | ~6.6% |
| Public Bank | Bank of Baroda, PNB, Union Bank | ~6.6% |
| Public Bank | Canara Bank | ~6.5% |
| Public Bank | SBI (special term 444 days) | ~6.6%; regular one-year ~6.45% |
Why Rates Vary and What to Watch For
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Senior Citizen Add‑Ons: Many banks offer an extra 0.25–0.5% for senior citizens—HDFC’s 7.35% rate for seniors is a clear example.
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Certificates of Deposit (CDs): These are wholesale instruments and can yield higher than retail FDs. IndusInd’s 7.75% rate is for CDs, not regular retail FDs.
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RBI Policy Influence: With the Reserve Bank of India cutting the repo rate by 50 basis points in June 2025 (from 6% to 5.5%), many banks adjusted their FD rates downward in response to reduced funding costs.
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Comparison with Small Finance Banks (SFBs): Small finance banks may offer much higher rates—up to 8% or more—but our focus here is on mainstream private and public banks.
Detailed 1,000‑Word Paragraph (in English)
Fixed Deposits (FDs) remain one of the most preferred investment avenues for Indian individuals due to their simplicity, safety, and guaranteed returns. Among various FD tenures, the one-year option enjoys particular popularity because it offers an appealing balance—long enough to yield a meaningful return, yet short enough to maintain liquidity. Many banks, both private and public sector, offer competitive one-year FD rates that hover between 6.4% and 6.6%, with some exceptions providing marginally higher returns. For instance, leading private banks like HDFC, ICICI, Axis, and Kotak Mahindra generally offer one-year FD rates around 6.6%, often extending slightly improved interest rates (up to 7.35%) for senior citizens. On the other hand, IndusInd Bank has been observed offering an impressive 7.75% yield, though this higher rate pertains to Certificates of Deposit (CDs) rather than conventional retail FDs.
Among public sector banks, Bank of Baroda, Punjab National Bank, and Union Bank of India maintain rates close to the 6.6% mark; Canara Bank offers around 6.5%, while the State Bank of India sets its one-year rate around 6.45%, with certain tenures like 444 days reaching near 6.6%. These variations are influenced by broader monetary policy shifts—such as the RBI’s repo rate cut in June 2025—which prompted many banks to lower deposit rates accordingly. Moreover, senior citizens often benefit from additional interest, enhancing the fixed deposit’s appeal for that demographic. While these rates reflect current trends, investors seeking even higher returns may explore fixed deposits from small finance banks, which can offer upwards of 8%, albeit with different risk and liquidity profiles. In summary, for the average Indian investor seeking secure, guaranteed returns over a one-year horizon, banks continue to deliver solid FD offerings spanning from 6.4% to 6.6%, with certain options nudging higher for specific instruments or customer segments.