Earn more than 6% interest rate on these 5-year bank FDs


Ever since the Reserve Bank of India (RBI) started to hike key policy rates in May 2022, banks, too, have been increasing fixed deposit interest rates regularly passing on the benefits to its customers.

Here is a look at the 5 banks offering the highest interest rates on 5-year b FDs. Note that these are different from tax-saving fixed deposits with fixed 5-year tenure.

5 banks offerings highest interest rates for 5-year FDs

Bank Name 5 Year Qly Compound Return
Indusind Bank 6.75 13974.99
DCB Bank 6.60 13872.27
RBL Bank 6.55 13838.20
IDFC First Bank 6.50 13804.20
HDFC Bank 6.10 13535.05

Compiled by ETIG; interest rates as on September 15, 2022

Difference between a Cumulative and Non-Cumulative FD
There are two types of fixed deposits: cumulative and non-cumulative. According to the IDFCFirst Bank website, “In a cumulative fixed deposit scheme, there is no fixed interest given half-yearly or every year. The interest is compounded and paid after the term. For example, if you invest at 10% interest in a financial firm’s cumulative plan, you will not receive interest regularly, but only after the scheme’s term. Interest is compounded quarterly in a cumulative or reinvestment fixed deposit. Later, the compounded income is re-invested with the principal. Cumulative fixed deposits have a maturity duration ranging from six months to ten years.”

Interest on term deposit
According to the SBI Bank website, “Interest on a Term Deposit is payable to the depositor quarterly from the date of issue or at maturity along with principal. But on request from the depositor, interest may be paid at monthly, half-yearly or yearly intervals in case of Term Deposits fixed for a term of twelve months and above.”



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