Investing a substantial amount in market-linked tools can be a risky manoeuvre unless you’re ready to endure volatility. However, FDs offer a safe haven to risk-averse investors who are looking to park their savings in a stable tool that provides them with assured returns with periodic interest payouts.
For instance, if you deposit a sum of ₹5 Lakhs, then you can earn interest of more than ₹2 Lakhs over 5 years at a rate of 7%. Moreover, you can reinvest the maturity amount to benefit from compounded interest.
Read on to learn more about the applicable interest rates offered by various banks and NBFCs in the following sections.
The table below indicates the monthly interest payout on a ₹5 Lakh FD you could earn across different banks and NBFCs for a tenor of 5 years:
Bank/NBFC/HFC |
Non-Senior Citizen (p.a.) |
Monthly Interest Payout |
Senior Citizen (p.a.) |
Monthly Interest Payout |
8.05% |
₹ 3,354 |
8.30% |
₹ 3,458 |
|
7.39% |
₹ 3,079 |
7.69% |
₹ 3,204 |
|
8.05% |
₹ 3,354 |
8.30% |
₹ 3,458 |
|
Muthoot Finance |
7.50% |
₹ 3,125 |
8.00% |
₹ 3,333 |
LIC Housing Finance |
7.75% |
₹ 3,229 |
8.00% |
₹ 3,333 |
8.27% |
₹ 3,446 |
8.77% |
₹ 3,654 |
|
ICICI Bank |
7.00% |
₹ 2,917 |
7.50% |
₹ 3,125 |
HDFC Bank |
7.00% |
₹ 2,917 |
7.50% |
₹ 3,125 |
IDFC First Bank |
7.00% |
₹ 2,917 |
7.50% |
₹ 3,125 |
Axis Bank |
7.00% |
₹ 2,917 |
7.75% |
₹ 3,229 |
IndusInd Bank |
7.25% |
₹ 3,021 |
8.00% |
₹ 3,333 |
7.25% |
₹ 3,021 |
8.00% |
₹ 3,333 |
|
Jana Small Finance Bank |
7.25% |
₹ 3,021 |
7.75% |
₹ 3,229 |
Kotak Mahindra Bank |
6.20% |
₹ 2,583 |
6.25% |
₹ 2,604 |
SBI |
6.50% |
₹ 2,708 |
7.50% |
₹ 3,125 |
7.25% |
₹ 3,021 |
7.75% |
₹ 3,229 |
|
7.20% |
₹ 3,000 |
7.70% |
₹ 3,208 |
*Disclaimer: The above-mentioned rates are effective as of 20 October 2023, and are subject to change at the issuer’s discretion.
Here is an estimate of the monthly interest payout you would receive on a ₹5 Lakh fixed deposit across various interest rates.
Deposit Amount |
Interest Rate (p.a.) |
Monthly Interest Payout |
₹5 Lakh |
3.00% |
₹ 1,250 |
₹5 Lakh |
3.50% |
₹ 1,458 |
₹5 Lakh |
4.00% |
₹ 1,667 |
₹5 Lakh |
4.50% |
₹ 1,875 |
₹5 Lakh |
5.00% |
₹ 2,083 |
₹5 Lakh |
5.50% |
₹ 2,292 |
₹5 Lakh |
6.00% |
₹ 2,500 |
₹5 Lakh |
6.50% |
₹ 2,708 |
₹5 Lakh |
7.00% |
₹ 2,917 |
₹5 Lakh |
7.50% |
₹ 3,125 |
₹5 Lakh |
8.00% |
₹ 3,333 |
₹5 Lakh |
8.50% |
₹ 3,542 |
₹5 Lakh |
9.00% |
₹ 3,750 |
₹5 Lakh |
9.50% |
₹ 3,958 |
₹5 Lakh |
10.00% |
₹ 4,167 |
Now that you have a better understanding of the potential returns you could earn on a ₹5 Lakh FD, choose an issuer of your choice. On Bajaj Markets, you can select from multiple FD issuers who offer competitive interest rates.
Moreover, you can also make use of the FD interest calculator on the platform to determine the potential returns you could earn on your fixed deposit investment.
Check Monthly Interest Rates on Your Fixed Deposits |
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To open a ₹5 Lakh fixed deposit, you need to submit proof of identity such as a PAN card, Aadhaar card, driving licence, voter’s ID, etc. Additionally, you will be required to provide proof of address, including documents like a passport, registered rent agreement, bank passbook with photo, electricity bill, etc.
To invest in a ₹5 Lakh fixed deposit, you must be at least 18 years old and an Indian resident. The eligibility criteria may vary slightly depending on the policies of the bank or NBFCs where you plan to open the FD.
You can calculate the monthly interest on a ₹5 Lakh FD using an FD calculator available online or by performing manual calculations. An FD calculator allows you to enter the deposit amount, interest rate, and tenor to determine the interest payout and total maturity amount instantly. Alternatively, you can calculate interest manually using the formula:
M = P (1 + r/n)^(n*t)
Where:
M is the maturity amount
P is the principal amount (₹5 Lakhs in this case)
r is the interest rate
n is the compounding frequency
t is the tenor in years
Yes, the monthly interest earned on a ₹5 Lakh fixed deposit is subject to taxation as per the Income Tax Act, 1961. Suppose the annual interest income exceeds the specified threshold. In that case, TDS (Tax Deducted at Source) is applicable, and the depositor is required to declare the interest income while filing income tax returns.
Yes, there may be penalties for premature withdrawal of a ₹5 Lakh fixed deposit before the maturity date. The specific penalty amount and terms depend on the policies of the bank or NBFC where the FD is held. Generally, the penalty amount is deducted from the interest earned, the principal amount, or both.
On non-renewal of your ₹5 Lakh FD after maturity, the bank/NBFC may transfer the matured amount along with the interest earned to your linked savings account. Alternatively, they may provide options for renewing the FD for another term or withdrawing the funds entirely.
In most cases, you cannot add more money to an existing fixed deposit during the tenure. Fixed deposits are typically opened for a specific amount for a fixed term, and additional deposits may not be allowed once the FD is initiated. However, you can open a new FD with additional funds if desired.
Deposits in banks/ NBFCs are often insured up to ₹5 Lakhs by deposit insurance schemes such as the Deposit Insurance and Credit Guarantee Corporation (DICGC) in India.