Interest rates on small savings schemes have gone up significantly in the last few quarters. Even the interest rate on Post Office Time Deposit (Post Office TD) maturing in five years has reached 7.5 per cent for the July-September quarter of 2023. Apart from this, during the last few months, almost every type of banks have also increased the interest rates on their fixed deposits. In such a situation, it is important to understand where you should invest your money.
post office time deposit scheme
Post Office Time Deposit is similar to Bank Fixed Deposit. You invest money at a fixed rate of interest for a fixed period and you are given a pre-decided rate of return on that. This is a government scheme and your money is completely safe in this. For the July-September 2023 quarter, you can get an interest rate of 7.5 per cent on a five-year post office fixed deposit. At 7.75 per cent interest rate, only DCB Bank offers 0.25 per cent more than the five-year POTD.
What is the interest rate on FD of banks
Meanwhile, banks like HDFC Bank, ICICI Bank, Axis Bank and IDFC First Bank offer an interest rate of 7 per cent on deposits maturing in five years. IndusInd Bank offers an interest rate of 7.25 per cent on FDs maturing in five years. SBI offers an interest rate of 6.5 percent for FDs maturing in five years.
How is interest rate calculated?
In the 5-year Post Office Time Deposit scheme, the interest is compounded quarterly but accrues annually. Annual interest can be credited to the account holder’s savings account by submitting an application. To open Post Office Time Deposit online, you must have a savings account with India Post. Or you can open an account in any post office. However, through the fast internet banking facility, you can open your account online in any major bank.
Who can open 5 years Post Office Time Deposit and 5 years Bank FD?
You also need to be a citizen of India to open your account in the post office. Any minor above the age of 10 years can open an account in the post office in his own name. A resident Indian can open a Fixed Deposit in any bank in India.
