Personal Finance

Banks offering highest interest rates on 1-2 years FDs


With many banks raising their fixed deposit interest rates, this is the right time to invest in fixed deposits. Fixed deposits offer a wide range of tenure options. Here are the banks that offer the highest interest rates on fixed deposits for tenures of 1–2 years.

Fixed deposit: Highest rate on FDs with 1 year tenure

Fixed deposit: Highest rate on FDs with 2 year tenure

Avoid premature withdrawal to maximise returns

The FD laddering method can help you get the most out of bank FDs, but caution should be exercised to avoid early withdrawal. The tenure and the plan should ideally be carefully chosen.

If you are unsure of when you might need to withdraw money from your FD, search for institutions that don’t impose an early withdrawal penalty.

Reasons for Investing in Fixed Deposits

According to the

website, below are some of the reasons for investing in fixed deposits:

  • It is risk-free and guarantees fixed returns.
  • Fixed deposit interest rates are higher than other risk-free investment instruments like Treasury Bills or Government Bonds.
  • Fixed deposits provide complete flexibility with regard to the tenure of investment.
  • The term of fixed deposits can vary between 7 days to 10 years. The investor can choose any time-period for investment in fixed deposits.
  • Investors can avail loans or overdrafts against fixed deposits whenever required.
  • It is a liquid investment; you can break your fixed deposits either partially or completely when required.
  • It saves you from the uncertainties of the markets and you can concentrate on your business or job by keeping your investments safe in fixed deposits.
  • Tax saver fixed deposits of 5 years are helpful for tax savings as the investor can claim tax deduction for the money saved in it as per Section 80C of the Income Tax Act.



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