FD Interest Rates July 2025: In recent months, many banks have cut interest rates several times on fixed deposits (FD). This is especially causing trouble to the senior citizens, because most of their investment remains in FD. However, still senior citizens are still getting attractive interest on FD up to 8.8%.
Public sector bank
If you want to make a fixed deposit in a government bank, then there are good interest rates for senior citizens there. These banks are considered reliable in terms of stability and safety, although their interest rates are slightly lower than private or small finance banks.
| Bank |
Maximum interest rate (%) |
| Punjab & Sindh Bank | 7.55% |
| Bank of india | 7.50% |
|
Central bank of india |
7.50% |
|
Indian Overseas Bank |
7.45% |
| Indian bank | 7.40% |
Private sector bank
Private sector banks usually offer slightly higher interest rates from public sector banks, and sometimes also offer flexible tenure options. Senior citizens can get interest of up to 7.90% here, especially in some options like SBM Bank.
| Bank |
Maximum interest rate (%) |
| SBM Bank | 8.55% |
| Binding bank | 7.90% |
| CSB Bank | 7.90% |
| DCB Bank | 7.90% |
| RBL Bank | 7.80% |
Small finance bank
If you can take a little risk for more returns, small finance banks can be the best option. These banks are offering the highest interest rates in the market, especially for senior citizens. Such as sunrise bank 8.80% and Utkarsh Bank 8.75%.
| Bank |
Maximum interest rate (%) |
| Sunrise small finance bank | 8.80% |
| Utkarsh Small Finance Bank | 8.75% |
|
Shivalik Small Finance Bank |
8.55% |
|
Slice small finance bank |
8.50% |
| Fincare Small Finance Bank | 8.25% |
RBI reduced repo rate
In 2025, the Reserve Bank of India (RBI) has cut the repo rate by a total of 100 basis points (1%). When the RBI reduces the repo rate, that is, the banks give loans cheaply, then banks make loans cheaper. But at the same time, they also reduce interest on FD, because now they do not need to raise money from customers on expensive interest.
Relief for senior citizens in TDS also
In the budget of 2025, senior citizens have been given great relief in TDS. Now from 1 April 2025, banks will deduct TDS only when the total annual interest on FD is more than ₹ 1 lakh. Earlier this limit was ₹ 50,000. Also, if the total income of a senior citizen is less than ₹ 12 lakhs (from FY26), they can avoid TDS by giving Form 15H to the bank, even if the interest goes above ₹ 1 lakh.
What to do investors?
Despite the repo rate cut, FD is still a safe and beneficial investment option for senior citizens. Banks can modify their interest rates even further, so in July 2025, book FDs thoughtfully according to the current rates and tenure. Before investment, compare the rates of all banks.
Also read: Home Loan EMI: Thinking of taking a home loan to buy a house? These 10 banks are giving the cheapest debt
Disclimeer: The FD rates of all these banks for senior citizens are till 6 July 2025. These are taken from the official website of banks. You must confirm the bank once before making any investment.