Reading the table like a banker
Two distortions hide in every FD rate card. First, the headline number a bank advertises is usually a special tenure — 400-odd or 555 days is a favourite — while the round 1-year rate we standardise on here is often lower; when you compare banks, make sure you are comparing the same tenure, not each bank’s best-dressed one. Second, the quoted rate assumes a cumulative deposit with quarterly compounding; choose a monthly-payout FD and the effective return drops slightly, because interest paid out stops compounding. The highest cell in the table is therefore a starting point, not a decision.
The small-finance-bank premium at the top of the table is genuinely usable — SFBs are licensed banks and their deposits carry the same DICGC insurance as anyone else’s — but the protection is capped per depositor per bank, so size your deposit under the limit with headroom for interest. Our deposit-insurance guide explains the exact mechanics, including how joint accounts multiply the cover.
Before you book, two more checks: the premature-withdrawal terms (a broken FD is repriced to the shorter tenure’s rate minus a penalty — the math is in our breaking-an-FD guide), and whether you should be booking one FD at all rather than a ladder of staggered maturities, which earns long-tenure rates while keeping some money always near liquidity. Interest is taxable at your slab rate, so compare post-tax when weighing an FD against PPF, RD and SIP alternatives.