High Yield Savings Account

Discover if high-yield savings accounts are beneficial. Maximise your savings potential with this insightful guide to make informed decisions.
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3 min
05-November-2025

When it comes to saving money, choosing the right account can make all the difference in how fast your wealth grows. While high-yield savings accounts offer higher interest rates than regular savings accounts, fixed deposits (FDs) provide guaranteed returns and long-term stability. Understanding both can help you make an informed decision that fits your financial goals.

What is a high-yield savings account?

A high-yield savings account is a type of deposit account that earns a higher rate of interest compared to traditional savings accounts. These accounts are usually offered by online banks or credit unions, allowing customers to earn up to 10–12 times more interest than the average savings account, which typically offers around 3% p.a. in India.

If you want to grow your savings safely and earn assured returns, consider opening a Bajaj Finance Fixed Deposit – one of India’s most trusted investment options. Check FD Rates.

Are high-yield savings accounts worth it

Holding a high-yield savings account is worth it as it is an ideal option for those looking to save for short-term purposes, such as an emergency fund or a big upcoming purchase. This type of account can help you grow your money risk-free and reach your financial goals faster than a conventional savings account. For instance, saving for a sizeable down payment for your car can help you reap higher interest, and the extra funds earned can be used for your monthly payments.

Fixed Deposit

  1. Trusted by over 5 lakh customers
  2. Fixed Deposits worth more than Rs. 50,000 crore booked
  3. Rated CRISIL AAA/STABLE and [ICRA]AAA(STABLE)
  4. Up to 0.35% p.a. extra interest offered for senior citizens
  5. Flexible interest payout options available - Monthly, Quarterly, Half-yearly, Annually or at Maturity

By proceeding, you agree to our Terms and Conditions

What is the difference between a high-yield savings account and a CD

Both high-yield savings accounts and Certificates of Deposit (CDs) allow you to earn interest on your money. However, the key difference lies in access and rate stability.

  • High-yield savings accounts offer flexible withdrawals but have variable interest rates.
  • CDs or FDs offer fixed interest for a set tenure but restrict premature withdrawals.

In India, FDs are the preferred alternative to CDs — offering similar stability with flexible tenure options ranging from 12 to 60 months.

With Bajaj Finance FD, you can choose between cumulative (earn more with compounding) and non-cumulative (get monthly/quarterly payouts) options to match your financial needs. Book now!

Are high-yield savings accounts safe

A high-yield savings account is a safe option as it is regulated by the Reserve Bank of India (RBI) and subject to deposit insurance provided by the Deposit Insurance and Credit Guarantee Corporation (DICGC), ensuring protection for deposits up to a certain limit in case of bank failure.

Cons of a high-yield savings account

  • High-yield savings accounts are not designed for everyday banking, such as paying bills or buying groceries.
  • Because these accounts offer better interest rates than standard savings accounts, they may have stricter requirements, such as higher initial deposit amounts or withdrawal limits.
  • While you earn interest on a high-yield savings account, it may not be enough to keep up with inflation or accomplish long-term goals such as retirement savings. Understanding what is a high-yield savings account's interest potential helps individuals make informed financial decisions.

Open your FD online in just a few clicks and start earning guaranteed returns instantly. Check rate

Fixed deposit variants

Highest Credit Ratings | Trusted with over 1.4 million Deposits | Assured Returns on FD
Recommended

Fixed Deposit - 60 Months

INTEREST RATES UP TO
7.30% p.a.
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Fixed Deposit - Senior Citizen

INTEREST RATES UP TO
7.30% p.a.
Invest Online

Fixed Deposit - Age below 60

INTEREST RATES UP TO
6.95% p.a.
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Fixed Deposit - Minor

INTEREST RATES UP TO
6.95% p.a.
Open FD

Fixed Deposit - HUF

INTEREST RATES UP TO
6.95% p.a.
Open FD

Fixed Deposit - Sole Proprietor

INTEREST RATES UP TO
6.95% p.a.
Open FD

Should I put my money in a high-yield savings account or invest

The most commonly asked question by investors is, what is a high-yield savings account’s benefit compared to investing? Simply put, it is a safer option for steady growth. Investing may bring higher annual returns, but it also brings the risk of unpredictable returns. A high-yield savings account offers a competitive interest rate without the risk of losses. While the interest rate is variable, this account can be a great option for growing your savings while avoiding the risks associated with investing in the stock market. If your goal requires quick access to funds, you may prefer holding your money in a high-yield savings account.

Does deactivating a high-yield savings account affect credit score

Another important question you may have is, what is a high-yield savings account's impact on the credit score? Essentially, it is minimal since savings are not a credit product. Your credit score is based on how you manage borrowed money and whether your accounts have debts. While closing a bank account does not hamper your credit score, having a negative balance when the account is closed can negatively impact your credit score.

What to look for when opening a high-yield savings account

Before opening one, consider:

  • The interest rate and how often it changes
  • Fees and maintenance charges that could reduce your earnings
  • Minimum balance requirements
  • Ease of access and online management tools

Alternatively, if you prefer zero maintenance and fixed returns, an FD could be a simpler and more rewarding choice. Book FD.

Fees and minimum balances

High-yield savings accounts are generally free as they are offered online, which allows banks to have lower overhead and pass the savings on to customers.

However, it is important to evaluate what is a high-yield savings account’s fee when exploring your choices. Some financial institutions may charge monthly maintenance and minimum balance fees.

Fully digital banking

High-yield savings accounts provide competitive interest rates as they are offered online. This makes them ideal for clients who prefer convenient online banking. Moreover, these savings accounts are provided on user-friendly online platforms, allowing you to effortlessly manage your account, set up automatic transfers and track transactions.

Conclusion

While high-yield savings accounts offer better liquidity, they can’t match the guaranteed returns of a fixed deposit. If your goal is to grow your savings securely and predictably, a Bajaj Finance FD is a more reliable option. It’s simple, stable, and offers high returns — everything you need for a worry-free financial future. Check FD Rates.

Calculate your expected investment returns with the help of our investment calculators

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Frequently asked questions

What is the minimum amount to start an FD?

You can start investing with just Rs. 15,000 and enjoy assured returns with flexible tenures from 12 to 60 months. Open FD.

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Disclaimer

As regards deposit taking activity of Bajaj Finance Ltd (BFL), the viewers may refer to the advertisement in the Indian Express (Mumbai Edition) and Loksatta (Pune Edition) furnished in the application form for soliciting public deposits or refer https://www.bajajfinserv.in/fixed-deposit-archives
The company is having a valid Certificate of Registration dated March 5, 1998 issued by the Reserve Bank of India under section 45 IA of the Reserve Bank of India Act, 1934. However, the RBI does not accept any responsibility or guarantee about the present position as to the financial soundness of the company or for the correctness of any of the statements or representations made or opinions expressed by the company and for repayment of deposits/discharge of the liabilities by the company.

For the FD calculator the actual returns may vary slightly if the Fixed Deposit tenure includes a leap year.