October 25, 2025

Are you a senior citizen hunting for juicy fixed deposit (FD) returns? Here’s the spicy news! Some small finance banks are still serving hot interest rates up to 8.1% for a five-year FD term. But hold on, this offer has a Rs 3 crore cap per investor. Want the full menu? Suryoday Small Finance Bank leads with a zesty 8.1% rate. Jana Small Finance Bank follows with a solid 8%, while Utkarsh Small Finance Bank offers up to 7.7%. These banks are turning up the heat in FD rates exclusively for those aged 60 and above. It's like finding the perfect masala mix for your money! But before you dive in, here’s a word of caution: deposits with small finance banks are insured up to Rs 5 lakh by the Deposit Insurance Credit Guarantee Corporation (DICGC). Experts suggest you keep your FD amount within this limit to protect your money fully because small finance banks have different risk profiles compared to big scheduled commercial banks. Now, let’s talk about the spicy tax twist – TDS or Tax Deducted at Source! Banks must deduct TDS if your FD interest from a single bank crosses Rs 1 lakh in a year. Remember, TDS is not an extra tax; it’s like an advance payment. You can get it refunded or adjust it while filing your income tax return. Plus, if you deserve a refund, you might even get interest on that amount. For example, a senior citizen earning Rs 11 lakh can enjoy full income tax exemption thanks to Section 87A rebate under the new tax regime for FY 2025-26, which applies up to Rs 12 lakh. Also, if your total income after deductions stays below Rs 12 lakh (new regime) or Rs 5 lakh (old regime), you can submit Form 15H to the bank. This naughty form tells banks, “Hey, don’t deduct my TDS!” Even if your income is below taxable limits, banks still deduct TDS once FD interest crosses Rs 1 lakh because they don’t know your full tax story. So, filing Form 15H is a smart move to stop TDS upfront. In short, the FD rates are mouth-watering, but keep your eyes open about limits and taxes. Lock your money smartly, enjoy the tasty returns, and use Form 15H to keep more of your hard-earned cash. Happy investing, senior citizens!

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Tags: Fixed deposits, Senior citizens, Interest rates, Small finance banks, Tds, Form 15h,