Once you turn sixty the focus shifts towards security, sensible investments and post retirement life. Fixed deposits (FDs) can be the perfect answer to all of the above questions. Especially for senior citizens who are looking to start a new life after completing their working careers.
FDs are nothing but government backed instruments that provide guaranteed returns and the additional interest for senior citizens. This additional premium can be around 0.50% to 0.75% for senior citizens and makes this investment product even more lucrative.
As interest rates remain dynamic amid monetary policy changes, some public sector banks are offering senior FD rates close to 8% per annum, especially on mid-term tenures ranging between 400 to 555 days. Below is a crisp snapshot of the five PSU banks currently offering the most competitive senior citizen FD rates in June 2025.
Senior Citizen FDs: What makes them attractive?
- Fixed, assured returns with minimal risk exposure.
- Extra interest premium (0.25%–0.50%) for senior depositors.
- Ideal for post-retirement income planning.
- Suitable for short- to mid-term financial goals.
- Covered under DICGC insurance up to ₹5 lakh.
Note: The features of fixed deposits discussed above are illustrative in nature for the updated terms and conditions refer to the official website of your respective bank. Also DICGC refers to the Deposit Insurance and Credit Guarantee Corporation, a subsidiary of RBI.
Top banks offering highest FD interest rates for seniors
Among the top PSU banks, Central Bank of India and Punjab & Sind Bank are drawing attention with limited-period high-yield offers for senior citizens.
These schemes are especially attractive for those locking in rates before any likely monetary policy easing. Meanwhile, Bank of Maharashtra continues to reward consistency with a flat senior bonus, making it a dependable option across multiple FD tenures.
Note: The above FD interest rate ranges are indicative and may vary based on specific schemes, tenure, and withdrawal conditions. Senior citizens are advised to verify exact rates and terms with the respective bank before investing. Rates are current as of June 10, 2025, and subject to change without prior notice.
Senior citizens should hence look beyond just the headline rate and choose fixed deposits based on their cash flow needs, future goals, tenure comfort, and overall financial plan.
Select PSU banks are still providing near 8% returns. That is why now can be a good time to lock in rates strategically after proper consultation with a certified financial advisor. A laddered FD portfolio can offer both liquidity and yield stability in a potentially softening rate cycle.
Disclaimer: FD rates are as of 10th June 2025 and may change. Please verify with the respective banks before investing. This article is for information only, not financial advice.
