These Banks Offer Higher Returns On Fixed Deposits Than Their Larger Counterparts

Small finance banks offer interest rates to the tune of 3.5-8.5 per cent on fixed deposits up to Rs 2 crore.

These Banks Offer Higher Returns On Fixed Deposits Than Their Larger Counterparts

Small finance banks provide a variety of fixed deposit lock-in options to their customers

Small finance banks - which are primarily aimed at financial inclusion - often pay higher fixed deposits (FDs) compared to their larger counterparts, such as State Bank of India (SBI), and financial institutions such as India Post. Small finance banks, such as Ujjivan, Equitas, Utkarsh and Jana, offer interest rates to the tune of 3.5-8.5 per cent per annum on retail fixed deposits (fixed deposits up to Rs 2 crore), according to their websites. Just like the country's top commercial banks, small finance banks also offer a variety of maturity options for term deposits to their customers, starting from seven days. 

Here's a comparison of fixed deposits interest rates offered by few small finance banks:

Ujjivan Small Finance Bank

Maturity PeriodInterest Rate With Effect From June 1
Seven to 29 days3.50%
30 to 89 days4.50%
90 to 179 days5.25%
180 to 364 days5.65%
One to two years6.95%
Two years and one day to three years6.50%
Three years and one day to five years 6.25%
Five years and one day to 10 years6%
(Source: ujjivansfb.in)

Ujjivan Small Finance Bank provides a 50-basis-point (0.5 percentage point) higher return to senior citizens, according to its website.

Equitas Small Finance Bank

Maturity PeriodInterest Rate With Effect From June 1
Seven to 14 days3.60%
15 to 29 days3.60%
30 to 45 days4.10%
46 to 62 days4.60%
63 to 90 days5.60%
91 to 120 days5.85%
121 to 180 days5.85%
181 to 210 days6.10%
211 to 270 days6.10%
271 to 364 days6.60%
One year to 18 months7.10%
18 months and one day to two years7.10%
Two years and one day to 887 days7.15%
888 days7.35%
889 days to three years7.15%
Three years and one day to four years6.75%
Four years and one day to five years6.75%
Five years and one day to 10 years6.75%
(Source: equitasbank.com)

Equitas Small Finance Bank provides a 60-basis-point higher return to senior citizen depositors (not applicable for NRE and NRO accounts), according to its website.

Utkarsh Small Finance Bank

Maturity PeriodInterest Rate With Effect From July 3
General PublicSenior Citizen
Seven to 45 days3.50%4%
46 to 90 days4.00%4.50%
91 to 180 days4.50%5%
181 to 180 days6.50%7%
365 days to 699 days7.75%8.25%
700 days8%8.50%
701 to 3,652 days7.75%8.25%
(Source: utkarsh.bank)

Jana Small Finance Bank

Maturity PeriodInterest Rate With Effect From July 13
General PublicSenior Citizen
Seven to 14 days4.50%5%
15 to 60 days5.25%5.75%
61 to 90 days6.25%6.75%
91 to 180 days6.50%7%
181 to 364 days6.75%7.25%
One year (365 days)7.25%7.75%
One to three years7.50%8%
More than three years to less than five years7%7.50%
Five years (1,825 days)7.25%7.75%
Five to 10 years 6.50%7%
(Source: janabank.com)

Meanwhile, the country's top banks - including State Bank of India, Punjab National Bank and HDFC Bank - offers interest rates up to 5.40 per cent on fixed deposits at present.