NEW DELHI — Senior citizens can now secure high-yield returns on five-year fixed deposits, with leading small finance banks offering rates as high as 7.9%. As of March 15, 2026, these rates provide a robust opportunity for retirees to maximize their interest income in a stable rate environment.

Leading Interest Rates for Senior Citizens

Suryoday Small Finance Bank currently leads the market with a top rate of 7.90% for a five-year tenure. Other high-performing institutions include Jana Small Finance Bank at 7.77%, followed closely by Ujjivan Small Finance Bank at 7.70%. Equitas and Utkarsh Small Finance Bank also offer competitive returns at 7.50%, while AU and slice Small Finance Bank provide 7.25%.

Tax Optimization and Form 15H

• TDS Awareness: Banks must deduct Tax Deducted at Source (TDS) if the annual interest earned at a single bank exceeds ₹1 lakh for senior citizens.
• Preventing Deductions: If your total tax liability is zero, you can avoid this deduction by submitting Form 15H to your bank.
• Rebate Limits: Under the New Tax Regime for FY 2025-26, the Section 87A rebate covers income up to ₹12 lakh. This means many seniors with significant FD interest will pay no tax and are eligible to use Form 15H.
• Safety Strategy: Investors are advised to keep their exposure within the ₹5 lakh limit per bank to ensure full protection under the DICGC insurance scheme, which covers both principal and interest.