Since the Reserve Bank of India raised repo rates in an off-cycle Monetary Policy Committee (MPC) meeting last month, banks across India have been raising interest rates on loans and deposits. Bank FDs are popular among people who do not want to invest in risky assets and prefer a safe and secure return on their money. FDs provide a consistent and guaranteed rate of return. This is also a better option when the stock market is underperforming and losing money. Fixed deposits, even when their returns are lower than those of risk assets, do not result in investor losses.
Almost every bank in India, including PSUs, have the option of opening fixed deposit accounts for customers. Here are the fixed deposit interest rates of some PSUs, which offer best returns.
Punjab National Bank (PNB)
Punjab National Bank has announced an increase in fixed deposit interest rates beginning July 4. PNB FD rates for deposits with terms of more than one year and up to two years have been raised by 10 basis points to 5.30 percent, up from 5.20 percent previously. PNB FD interest rates have been increased by 20 basis points for deposits maturing in two to three years. PNB FD interest rates for senior citizens have been raised by 50 basis points.
Union Bank of India
Union Bank of India offers a fixed deposit interest rate of 5.45 percent for terms ranging from one year to two years. Union Bank of India FD interest rates are 5.50 percent for two years and up to three years, and 5.75 percent for three years and up to five years.
Another PSU, UCO Bank, offers an interest rate of 5.30% for tenures of more than one year to less than two years, and the same rate for tenures of more than two years to up to three years. The interest rate on UCO Bank FDs for terms of more than 5 years to up to 5 years is 5.60 percent. The UCO Bank FD rate is 5.30% for terms longer than 5 years. Senior citizens who deposit less than Rs 2 crore receive an additional 50 basis points return on these rates.
Punjab and Sind Bank
Punjab and Sind Bank fixed deposit interest rates for tenures of 1 year to 2 years is 5.35 per cent, while the same for tenures of more than 2 years to less than 2 years is 5.40 per cent. Punjab and Sind Bank FD rates for a 3-year to less than 5 years tenure is 5.60 per cent, while it is the same for a tenure of 5 years to up to 10 years tenures. These rates are applicable for deposits below Rs 2 crore.