You need to know about Highest Fixed Deposit Interest Rates

For the fifth  consecutive time in this calendar year, the RBI has reduced the repo rate. The repo rate has been snipped by 25 bps. This is great news for borrowers, as loans get cheaper. But it is challenging for depositors as interest income from fixed deposits is likely to fall. Hence the depositors must look for financial institutions that can offer the best fd rates.

It is also the best time to go for fixed deposits with a long tenure as there is uncertainty about whether rates would be cut in the near future. A longer tenure (of say five years) would mean that interest rates would be fixed for those five years and depositors can enjoy a certain level of stability.

Here are some advantages of a fixed deposit that offers the highest rate of interest.

Interest Income

Interest income is crucial for depositors, especially if they are retired or are senior citizens. Using the interest income, depositors can manage their household budget or invest it. Interest income is directly proportional to fixed deposit interest rates. The higher the interest rate, the higher is the interest income. Therefore, depositors must always be on the lookout for highly-rated fixed deposits which can generate a healthy interest income.

Wealth creation

Wealth creation is possible by saving regularly. Whenever a depositor is able to save up a lump sum or receives a lump sum in the form of an incentive or bonus, she could invest it in a fixed deposit. If a depositor follows this habit regularly, then she would be able to create substantial wealth.


Creating a corpus is critical for retirement. It not only provides a safety net but can also be used for generating interest income. This enables seniors to lead independent lives. Highly rated fixed deposits offering best fd rates turn out to be preferable for seniors. This is because the deposits are secure and can also offer an attractive periodic income to senior investors.


Although there are several investment options in the market, high quality fixed deposit schemes tend to offer better security. High quality fixed deposits are not only preferred by risk-averse investors but even by those who wish to diversify their portfolio.

Since fixed deposit interest rates are not subjected to market volatility, depositors need not worry about fluctuating returns.

Long term investments

If a fixed deposit is offering a certain interest rate for a specified tenure, then the interest rate wouldn’t change during that tenure. This makes fixed deposits a preferred financial instrument to consider when there is uncertainty.

Depositors can choose a tenure which is suitable to their goals. For example, if a depositor needs funds after five years for buying a four-wheeler, then she can choose a fixed deposit scheme that offers an attractive rate of interest for a tenure of five years.

Depositors must also consider other benefits of high interest fixed deposits. They can avail of loans against the fixed deposit and prematurely cancel after three months of depositing their funds.


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