SBI Hikes Fixed Deposit Interest Rates; Seniors Can Earn Up To 8%

SBI has increased the interest rates on domestic term deposits; seniors stand to benefit the most, due to a scheme and premium offered by the bank. Read on to know more:

Outlook Money
March 4, 2023
SBI Hikes Fixed Deposit Interest Rates; Seniors Can Earn Up To 8%

India’s largest lender, State Bank of India (SBI), has increased its fixed deposit (FD) interest rates by five basis points (bps) to 25 bps on different categories, a day after it raised the lending rates by 25 bps.


The interest rate hike is applicable for FDs below Rs 2 crore, effective from February 15, 2023. Although the rate hike is applicable to all FDs with an initial maturity of over one-year, senior citizens stand to benefit the most, since they are already enjoying a 50 bps premium over normal rates. Also, SBI runs a specific scheme for seniors, SBI Wecare, which will earn up to 8 per cent interest rate on long term deposits with the latest hike. Generally, banks offer a higher premium to senior citizens. Also, the low risks associated with fixed term deposits make them an attractive investment option for them.

Revised FD Rates for General Deposits and Seniors

While increasing FD rates for general deposits (maturing in 2-3 years) to 7 per cent from the previous 6.75 per cent, the bank increased the same rate (25 bps) for deposits made by senior citizens. Compared with earlier rates of 7.25 percent, senior citizens now receive 7.50 percent for the same tenure.

For general deposits maturing from three years to 10 years, the rate was increased to 6.50 per cent from 6.25 per cent. Senior citizens previously enjoyed a rate of 6.50 per cent on deposits with three-five year tenure. This rate has been revised to 6.75 per cent.

Extra Benefit for Senior Citizens On 5-10-Year Deposits

Elderlies were entitled to 7.25 per cent on deposits with a tenure of five to 10 years, which has been hiked to 7.50 per cent. Additionally, SBI has a special deposit scheme for 5-to-10-year deposits, called SBI Wecare, paying senior citizens an additional 50 bps over and above the existing premium they receive, taking the total interest to 8 per cent for 5-to-10-year deposits. The scheme is extended up to March 31, 2023.

Rates Offered By Other Banks

For senior citizens, Citi Bank offers FD rates as high as 8.27 percent for 91 to 150 days tenure, whereas Standard Chartered offers 7.75 per cent for deposits maturing in two to three years. According to BankBazaar data, small finance banks offer the highest interest rates on fixed deposits for senior citizens. As of February 2023, Suryoday Small Finance Bank offers 8.76 percent interest (above two years), while Ujjivan Small Finance Bank offers 8.75 percent interest (less than one year).

Rates On Short-Term Deposits

In the one year to less than two-year tenure segment for general public, SBI hiked the rates by five bps to 6.80 per cent from 6.75 per cent previously. For seniors, it rose to 7.30 per cent from 7.25 per cent.

Interest rates on FDs with less than one-year tenures remain unchanged for all age categories. On 211 days to less than one year, the rates are 5.75 per cent; on 180 days to 210 days, 5.25 per cent; on 46 days to 179 days, 4.50 per cent; and on seven days to 45 days, three per cent. A senior will earn 6.25 per cent over 211 days to less than one year; 5.75 per cent over 180 days to 210 days; five per cent over 46 days to 179 days; and 3.50 per cent over seven days to 45 days.

SBI’s New Tenure Scheme

Effect from February 15, SBI will offer a special tenor scheme of “400 days” at a rate of 7.10 per cent. This scheme will remain valid until March 31, 2023.

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