Chasing High FD Returns? These 10 Small Finance Banks Offer the Best Rates for Senior Citizens

For India’s senior citizens, financial security isn’t just about saving but is also about earning enough on those savings to withstand rising costs. As inflationary pressures impact their disposable incomes, a growing number of retirees are turning to high-interest fixed deposits (FDs) offered by Small Finance Banks (SFBs) to boost their returns.

Small Finance Banks (SFBs) are specialized financial institutions in India that focus on financial inclusion by providing basic banking services to underserved and unbanked segments of the population. They are regulated by the Reserve Bank of India (RBI) and aim to bridge the gap in rural and semi-urban areas, targeting small businesses, micro and small industries, marginal farmers, and unorganized sectors.

Numerous SFBs are offering interest rates that touch, and in some cases, exceed 9% for senior citizens. That’s significantly higher than what most public and private sector banks are currently offering.

Among the standout performers this year is Unity Small Finance Bank, which is offering an impressive 9.50% interest on select senior citizen FDs. The second highest offering is by Equitas Small Finance Bank, which provides up to 9.25% on deposits with specific tenures like 444 days.

Jana Small Finance Bank (JSFB) also makes the list, offering 9.25% on FDs in the two–three-year range. Other top contenders include Utkarsh SFB (9.00%), Ujjivan SFB (8.75%), and Fincare SFB, where rates range from 8.70% to 8.90%, depending on the tenure.

Also offering competitive rates are Suryoday SFB (up to 8.75%), North East SFB (8.50%–8.75%), ESAF SFB (up to 8.50%), and Capital SFB, where senior citizens can earn up to 8.40%.

SFBs were set up with the specific mandate to serve underbanked segments of the population, particularly in rural and semi-urban India. Offering high FD rates is one way they compete for funds in a crowded market.