Senior citizen FDs of SBI, HDFC Bank vs SCSS: What should elderly prefer? | Mint (2024)

SCSS latest interest rates, tenure

The maturity period for the SCSS scheme is five years. It can be extended for another 3 years. At present SCSS is offering a guaranteed interest rate of 8.2 per cent. These rates are with effect from 1 January 2024. Once the investment is done the interest rate remains the same throughout the tenure. Senior citizens can invest up to ₹30 lakh in this scheme.

SBI senior citizen FD latest rates

State Bank of India (SBI), the country's largest lender, offers an interest rate between 4% to 7.50% for tenure ranging from 7 days to 10 years. On a 5-year tenure, SBI offers 7.25% to senior citizens. These rates were last revised on 27 December 2023.

Punjab National Bank (PNB) senior citizen FD latest rates

Punjab National Bank offers an interest rate between 4% to 7.75% for 7 days to 10 years for senior citizens. The bank offers 7% for senior citizens on deposits maturing in five years. These rates were last revised on 8 January 2024.

HDFC Bank senior citizen FD latest rates

HDFC Bank offers an interest rate between 4% to 7.75% for senior citizens. On a 5-year tenure, HDFC Bank offers 7.50%. These rates were last revised on 1 October 2023.

ICICI Bank senior citizen FD latest rates

ICICI Bank offers an interest rate between 3.50% to 7.65%. The bank offers 7.50% on 5-year tenure. These rates were last revised on 16 October 2023.

SCSS vs Bank FDs: Which offers the best rate?

If we talk about bank FDs, senior citizens get an additional rate of interest that can go up to 0.50% more than for the general public. While SCSS gives 8.2%, SBI, and PNB give 7.25%, and 7% respectively. HDFC, and ICICI Bank offer 7.5% to senior citizens on deposits maturing in five years.

Taxation on SCSS

Investments in SCSS, and five-year bank FD qualify for tax deduction under Section 80C. Currently, the SCSS deposit limit is ₹30 lakh. If you invest this amount, the quarterly interest will be ₹61,500, and the annual interest will be ₹2,46,000 (at 8.2% interest). Since this amount is above the ₹50,000 limit, TDS will be deducted at a specified rate.

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