Ever since Finance Minister Nirmala Sitharaman announced in her budget 2023 speech that the Senior Citizen Savings Scheme (SCSS) deposit limit will be hiked to Rs 30 lakh per account, several banks are trying to woo elderly depositors by offering higher rates on term deposits or fixed deposits. The banks are also taking advantage of the high-interest rate regime pivoted by RBI to provide attractive rates to senior citizens and other depositors. This article looks at the post-Budget Fixed Deposit interest rate hikes announced by several banks in India:
Read: Saving benefits in Budget 2023
The State Bank of India (SBI) has announced a new limited-period deposit scheme – SBI Amrit Kalash – that offers 7.6% interest to senior citizens on a deposit of 400 days
Unity Small Finance Bank is now offering up to 9.5% interest to senior citizens on deposits of 1001 days. On Fixed Deposits of 501 days and 181-201 days, the Unity Bank is offering 9.25% interest to senior depositors.
Bandhan Bank is offering up to 8.5% interest to senior citizens for a deposit of 600 days. On deposits of 3-5 years, the bank is offering 7.5% interest.
With effect from 10th February 20223, the Central Bank of India is offering 7.25% interest to senior citizens on non-callable deposits below Rs 2 crore for 1-2 years. The bank is also offering 7.85% interest to senior citizens on a special callable deposit of 444 days. On non-callable deposits, the bank is offering 8.1% interest for 444 days.
Jana Small Finance Bank is offering up to 8.8% interest to senior citizens on a deposit of 2-3 years. For deposits of 3-5 years, the Jana Bank is offering 8.05% interest and 8.2% on deposits of 1-2 years.
A number of benefits provided under SCSS make it better than bank Fixed Deposits. Currently, the SCSS interest rate is 8%. Moreover, investments under the SCSS account enjoy a sovereign guarantee whereas, in the case of FD, there is a guarantee of only up to Rs 5 lakh. SCSS account also offers tax benefits under Section 80C and allows senior citizens to use this scheme as a source of regular income.
Also read: What is Senior Citizen Savings Scheme which brought cheers to Sr. Citizens?
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