Best FD Rates for Feb 2026

A Fixed Deposit (FD) is a financial instrument provided by banks and NBFCs that offers investors a higher rate of interest than a regular savings account, until the given maturity date. It is considered one of the safest investment options where you deposit a lump sum amount for a fixed tenure.

The minimum deposit amount varies by bank. For most major banks like IDFC FIRST Bank, SBI, or HDFC, you can start a regular FD with as little as ₹1,000 to ₹5,000. For online bookings, some banks allow even lower minimums.

Yes, most banks allow partial premature withdrawals. However, you will typically be charged a penalty (usually 0.5% to 1%) on the interest rate applicable for the period the deposit remained with the bank. The remaining balance continues to earn interest at the original contracted rate.

Senior citizens (aged 60 years and above) generally receive an additional interest rate benefit, typically ranging from 0.50% to 0.75% over the standard FD rates. This provides a higher yield on their retirement savings.

Tax Saver FDs come with a mandatory lock-in period of 5 years. They offer tax deductions under Section 80C of the Income Tax Act, 1961. However, unlike regular FDs, these cannot be withdrawn prematurely before the completion of 5 years.

You can claim a tax deduction for investments up to ₹1.5 Lakh per financial year under Section 80C. This limit includes all your tax-saving investments combined (like PPF, ELSS, EPF, and Tax Saver FDs).

In the case of a joint Tax Saver Fixed Deposit, the tax benefit under Section 80C is available only to the first holder of the deposit. The secondary holder cannot claim this deduction.

Yes, quoting your PAN is mandatory for opening an FD. If you do not submit your PAN, the bank will deduct TDS (Tax Deducted at Source) at a higher rate of 20% instead of the standard 10% (if interest income exceeds ₹40,000 in a year), and no TDS certificate will be issued.