The Reserve bank of India (RBI) recently completed its Monetary Policy Committee (MPC) meeting, keeping the policy repo rate unchanged at 5.25% while signalling that the rate‑cut cycle may be over for now and future movements will depend on inflation and growth trends. This stance influences how banks price deposits and loans.

Even though RBI hasn’t raised the repo rate this time, markets are anticipating changes ahead, and some banks are tweaking their Fixed Deposit (FD) interest rates — especially on longer tenures and for senior citizens — to attract more deposits.

📈 Why FD Rates Fluctuate After RBI Policy Updates

Banks adjust FD interest rates based on the RBI’s monetary policy stance because this affects their cost of funds and liquidity:

✔ When the repo rate fell earlier, banks generally lowered FD rates — making loans cheaper but deposit returns smaller.

✔ With stable repo at 5.25%, some lenders are now holding or slightly increasing their FD rates again to compete for customers’ savings, particularly where deposit growth has lagged credit demand.

🏦 Current FD Interest Rates You Can Find in Banks (2026)

📌 Small Finance & Private Banks (High Rates for Savers)

According to recent rate data, many banks are offering attractive FD returns — particularly for senior citizens:

• Suryoday Small Finance Bank: ~7.90%
• Jana Small Finance Bank: ~7.77%
• ESAF Small Finance Bank: ~7.60%
• Utkarsh Small Finance Bank: ~7.50%
• YES bank (Senior): ~7.75%
• HDFC Bank: Up to ~6.95% on longer tenures
  (Tenure and rate vary by bank and customer type)

These rates are better than many large public sector banks’ general FD returns, especially for durations of 1–3 years.

👴 Senior Citizen FD Highlights

Bank‑wise rates for senior citizens (2025/2026 mix):

• Suryoday SFB: ~8.80% (top among many small banks)
• Utkarsh SFB: ~8.75%
• Shivalik SFB: ~8.55%
• Bandhan Bank: ~7.90%
• DCB bank / RBL Bank: ~7.80%–7.90%
• Public sector banks (e.g., punjab & Sind, bank of India): ~7.40%–7.55%
  (Highest available in recent offers across banks)

These rates show how some banks are competing aggressively to attract deposits, especially from older investors who value steady returns.

📊 Comparing FD Rates: General vs Senior Citizen

A snapshot of FD interest ranges you might find in early 2026:

Bank / Category

General Customers

Senior Citizens

HDFC Bank

~2.75%–6.45%

~3.25%–6.95%

YES Bank

~3.25%–7.00%

~3.75%–7.75%

Suryoday SFB

~7.90% (top)

~8.80%

Jana SFB

~7.77% / ~8.??%

Higher bands available

(Rates approximate and may vary by exact term and deposit data-size)

💡 What RBI Policy Means for FD Investors

📌 1. Stable Repo Keeps Deposit Costs in Check

Since the RBI kept the repo rate unchanged, banks are not compelled to sharply raise FD rates. Instead, many are holding or fine‑tuning them based on competitive strategy and deposit needs.

📌 2. Earlier Repo Cuts Led to Lower FD Rates

When RBI had cut the repo rate previously (from higher levels to now 5.25%), most banks responded by lowering deposit rates, which affected FD interest returns across tenures.

📌 3. Market Expectations Can Push Banks to Offer Slightly Better Yields

In times when investors look for safety and returns — especially seniors — banks may keep some higher‑yield FD products to attract funds in a competitive environment.

📍 Tips for FD Investors in 2026

🧠 1. Compare Across Banks: Don’t just go by one bank’s numbers — small finance banks often offer higher rates than large public or private banks.
👴 2. Senior Citizen Schemes Can Boost Returns: Many banks add an extra 0.25%–0.50% interest for seniors.
📅 3. Lock in Rates Smartly: If current rates are good for your tenure, consider booking FDs before banks revise them downward. Past repo cuts show rates can decline over time.
📍 4. Check Tenure‑Based Breakdowns: Short‑term and long‑term FD rates can differ significantly — always match the tenure to your financial goal.

🏁 In Summary

• The RBI maintained the repo rate at 5.25% in the latest policy meeting, shaping how banks adjust FD rates.
• Some banks are offering competitive FD interest rates — especially small finance and niche banks — while larger banks may be stable or trimming slightly in line with monetary conditions.
• Senior citizens can still find higher returns (up to ~8.8% in select banks).
• Investors should compare rates and choose tenures wisely given the current monetary policy stance.

 

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