Major and Small Finance Banks offer 5-year FD interest rates from 6 per cent to 7.9 per cent amid Middle East tensions

Amid ongoing tensions in the Middle East and volatility in stock markets, safe alternatives have become increasingly important for investors. In such times Fixed Deposit (FD) has emerged as a reliable investment instrument. Investing in FDs keeps the capital safe and returns with a fixed rate of interest. Experts also advise maintaining a balance between safe and risky investments in a portfolio.

FD interest rates offered by major banks change over a period of five years. ICICI Bank currently leads with 6.50 percent interest on 5-year FDs. Axis Bank offers 6.45 percent, HDFC Bank 6.40 percent, Punjab National Bank 6.10 percent and State Bank of India 6.05 percent. Union Bank of India is included in this list with 6.00 percent return.

An investor can get steady returns by doing a 5 year FD with ICICI Bank. For example, if one does FD twice for 5-5 years, the total return can reach around 13 percent, providing a fixed income with a safe investment.

Small finance banks also offer high returns in safe investment options. Suryoday Small Finance Bank currently offers 7.90 percent interest on 5-year FDs. AU Small Finance Bank offers 6.75 per cent, Equitas 7.00 per cent, ESAF 5.75 per cent, Jana 7.77 per cent, Shivalik 6.25 per cent, Slice 7.00 per cent, Ujjivan 7.20 per cent and Utkarsh 7.00 per cent.

A total return of around 15.8 per cent can be made in Suryoday Small Finance Bank if done twice for 5 years each, making it an option for long-term investment.

The main advantage of investing in FDs is that they are considered risk-free. Capital is protected during stock market volatility and fixed interest rate helps in financial planning. This type of investment gives long-term stable income over a period of 5 years.

Investors are advised to consider the bank’s interest rate and tenure before investing. Big banks like SBI, HDFC and ICICI are considered as a safe option, while small finance banks offer an option for higher returns. Investors should choose according to their financial plan and risk tolerance.

Bank conditions, prepayment rules and taxation information must be considered before opening an FD. Investors should consult a financial advisor to plan FD for long term benefits.