Investing ₹40 Lakhs in a fixed deposit (FD) unfolds as a savvy financial decision for reliable capital growth. The pivotal factor in this decision-making process is the interest rate linked to the FD.
Carefully selecting an FD with a competitive interest rate directly shapes the overall returns over the investment period. A preference for a higher interest rate not only guards against inflation but also assures a stable income stream. Therefore, a diligent focus on interest rates is essential when aiming for substantial financial gains and sustained wealth augmentation.
The table below indicates the monthly interest payout you could earn on a fixed deposit of ₹40 Lakhs over a tenor of 5 years.
Bank/NBFC/HFC |
Non-Senior Citizen (p.a.) |
Monthly Interest Payout |
Senior Citizen (p.a.) |
Monthly Interest Payout |
Bajaj Finance Ltd. |
8.05% |
₹26,833 |
8.30% |
₹27,667 |
PNB Housing Finance Ltd. |
7.65% |
₹25,500 |
7.95% |
₹26,500 |
Mahindra Finance Ltd. |
8.05% |
₹26,833 |
8.30% |
₹27,667 |
LIC Housing Finance Ltd |
7.50% |
₹25,000 |
7.75% |
₹25,833 |
Shriram Finance |
8.60% |
₹28,667 |
9.14% |
₹30,467 |
ICICI Bank |
7.00% |
₹23,333 |
7.50% |
₹25,000 |
HDFC Bank |
7.00% |
₹23,333 |
7.50% |
₹25,000 |
IDFC First Bank |
7.00% |
₹23,333 |
7.50% |
₹25,000 |
Axis Bank |
7.00% |
₹23,333 |
7.75% |
₹25,833 |
IndusInd Bank |
7.25% |
₹24,167 |
8.00% |
₹26,667 |
YES Bank |
7.25% |
₹24,167 |
8.00% |
₹26,667 |
Jana Small Finance Bank |
7.25% |
₹24,167 |
7.75% |
₹25,833 |
Ujjivan Small Finance Bank |
7.20% |
₹24,000 |
7.70% |
₹25,667 |
Kotak Mahindra Bank |
6.20% |
₹20,667 |
6.70% |
₹22,333 |
SBI |
6.50% |
₹21,667 |
7.50% |
₹25,000 |
AU Small Finance Bank |
7.25% |
₹24,167 |
7.75% |
₹25,833 |
Disclaimer: The above-mentioned rates are effective as of 16th November 2023 and are subject to change as per the issuer’s discretion.
Refer to the table below for the monthly interest income you could earn on an FD of ₹40 Lakhs across different interest rates:
Deposit Amount |
Interest Rate (p.a.) |
Monthly Interest Payout |
₹40 Lakhs |
6.00% |
₹20,000 |
₹40 Lakhs |
6.50% |
₹21,667 |
₹40 Lakhs |
7.00% |
₹23,333 |
₹40 Lakhs |
7.50% |
₹25,000 |
₹40 Lakhs |
8.00% |
₹26,667 |
₹40 Lakhs |
8.50% |
₹28,333 |
₹40 Lakhs |
9.00% |
₹30,000 |
₹40 Lakhs |
9.50% |
₹31,667 |
₹40 Lakhs |
10.00% |
₹33,333 |
Now that you have an understanding of the potential returns you could earn from an ₹40 Lakhs fixed deposit, you can secure your investment by booking an FD on Bajaj Markets. You can also use the FD calculator to determine the returns you could earn on your investment.
Check Monthly Interest Rates on Your Fixed Deposits |
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Your salary or business earnings are your primary source of income over which tax is deducted at source (TDS). When you get interest per month on a ₹40 Lakh FD, it is treated as ‘Income from Other Sources’.
This additional income is taxable as per the Income Tax Act of India. Banks and NBFCs are directed to deduct a 10% TDS at the end of each fiscal year. This, however, can be avoided by the submission of Form 15G to your FD provider.
The balance tax, if any, is calculated based on the individual’s tax slab and needs to be paid directly to the Income Tax Department.
The monthly interest on a ₹40 Lakh FD varies according to parameters such as the interest rate offered by the institution, the type of FD chosen, and the tenure of investment. NBFCs tend to offer higher returns than banks.
While the specific requirements may vary across different financial institutions, typically you need KYC documents and passport-size photographs. KYC documents include proof of identity like a PAN card, Aadhaar card, Driving Licence, Voter’s ID, or Passport.
You will also need to furnish certain documents as your proof of address such as an Aadhaar card, Driving Licence, Voter’s ID, or Passport.
All resident citizens of India and Hindu Undivided Families (HUFs) are eligible to open a regular ₹40 Lakh fixed deposit.
In addition, sole proprietorship or partnership firms, trusts, and limited companies can also apply for a ₹40 Lakh fixed deposit. However, the required documentation may differ accordingly.
The interest on ₹ 40 Lakhs is calculated using the formula: P (1 + r/n)nt - P, where P is the amount invested, r is the rate of interest, n is the frequency of compounding, and t is the investment tenor.
However, the quicker and more convenient way to calculate the interest is by using the online FD calculator at Bajaj Markets.