Are post office FDs better than bank FDs?

Post Office Time Deposit (POTD) at 5 years currently yields 7.5% — competitive with private bank rates. But there is no senior citizen bonus and the rate is notified quarterly rather than dynamically by the bank.

Interest rate

FD Interest Rates — Bank-Wise Comparison & Trends

FD rates differ across banks by 50–150 basis points for the same tenor. A quick scan can add ~₹15,000 to ₹50,000 over a ₹10 lakh, 5-year deposit.

// how to compare fd rates fairly

Compare the same tenor across banks — the sweet-spot 444/555-day special tenors at PSU banks often beat both 1-year and 3-year cards from the same bank. Also compare cumulative vs non-cumulative payout: for the same nominal rate, cumulative FDs deliver a higher effective yield due to compounding on retained interest.

// senior citizen bonus

Most banks offer 25–50 basis points above the general rate for resident depositors aged 60+. Some banks have introduced 'super senior' slabs (80+) with another 25 bps on top.

// special tenors

Bank-specific 'special tenor' FDs (444-day, 555-day, 700-day) frequently carry 25–50 bps over the standard 1-3 year slab. SBI Amrit Vrishti, Canara 444-day, BOI 555-day and PNB Uttam are examples that have appeared in recent rate cards.

// frequently asked questions

Small finance banks (Equitas, Ujjivan, AU SFB) typically offer 50–100 bps higher than scheduled commercial banks for similar tenors. They are also DICGC-insured up to ₹5 lakh per depositor per bank — usable but consider concentration.