For senior citizens looking to secure their golden years with stable returns, the latest updates from the banking sector bring nothing short of good news. It is truly a “silver lining” moment for retirees as Fixed Deposit (FD) interest rates remain highly attractive. If you are planning to park your savings for a medium term, specifically a 3-year tenure, several banks are now offering interest rates as high as 7.5%. Let’s dive into which financial institutions are offering these lucrative returns.
Top Contenders: Small Finance Banks Leading the Charge
When it comes to aggressive interest rates, Small Finance Banks (SFBs) are currently outperforming traditional heavyweights. According to recent market data, three specific banks have emerged as the top payers for senior citizens on 3-year deposits. Jana Small Finance Bank, Slice Small Finance Bank, and Utkarsh Small Finance Bank are all offering a handsome 7.5% interest rate.
Following closely behind are other competitive players like Suryoday Small Finance Bank, offering 7.25%, and Ujjivan Small Finance Bank at 7.20%. For retirees relying on interest income for daily expenses, these rates provide a significant boost compared to standard savings accounts.
Big Names and Special Schemes: SBI and Private Players
While Small Finance Banks offer higher yields, many seniors prefer the familiarity of established names. The country’s largest lender, State Bank of India (SBI), offers up to 6.80% on 3-year tenures. However, under the specific ‘SBI V Care’ scheme, seniors can avail of an additional 0.50-0.60% interest, making it a viable option for those prioritizing safety above all else.
In the private sector and NBFC space, Bajaj Finance is a strong contender, offering up to 7.30% for senior citizens. Additionally, banks like Indian Bank and Indian Overseas Bank are offering extra premiums (up to 0.75% extra) for super senior citizens (aged 80+), ensuring the oldest members of society get the best possible returns.
Smart Investing: Choosing the Right FD for Your Needs
While a high interest rate is the most attractive feature, financial experts suggest looking beyond just the percentage. Before locking in your money for three years, consider the bank’s credibility, the ease of online banking facilities, and most importantly, the terms regarding premature withdrawal.
Senior citizens should balance their portfolio by keeping some funds liquid for medical emergencies while locking the rest in these high-yield FDs. Always check if the bank offers doorstep banking services, which can be a crucial factor for ease of operation in later years.
Summary of Top 3-Year FD Rates for Senior Citizens
| Bank / Institution Name | Interest Rate (3-Year Tenure) |
|---|---|
| Jana Small Finance Bank | 7.50% |
| Slice Small Finance Bank | 7.50% |
| Utkarsh Small Finance Bank | 7.50% |
| Bajaj Finance | 7.30% |
| Suryoday Small Finance Bank | 7.25% |
| Ujjivan Small Finance Bank | 7.20% |
| AU Small Finance Bank | 7.10% |
| Equitas Small Finance Bank | 7.00% |
| State Bank of India (SBI) | 6.80% (Excluding V-Care Bonus) |
Conclusion: With rates hovering around 7.5%, now is an excellent time for senior citizens to review their investment portfolios. By splitting investments between high-yield Small Finance Banks and stable Public Sector Banks, you can ensure both growth and security for your hard-earned money.
Disclaimer: This article is for informational purposes only and does not constitute financial advice. Investors are requested to consult a certified financial advisor before making any investment decisions.
Last Updated: 18 January 2026
