Monthly Interest Rates for Rs. 40 lakh fixed deposit

In summary

A monthly payout can provide regular income while keeping the principal invested until maturity.

• Monthly income depends on applicable interest rates.
• Senior citizens receive higher interest rates.
• Longer tenures may offer better returns.
• Monthly payouts use non-cumulative interest rates.
• TDS may reduce the credited amount.
• The principal remains invested until maturity.

Use the applicable monthly payout rate when estimating income from a Rs. 40 lakh fixed deposit.

Benefits of investing in FD

A fixed deposit provides several features for investors seeking assured returns and flexible payout choices.

Key benefits include:

1. Assured Returns: The booked interest rate remains unchanged throughout the selected deposit tenure.
2. Senior Citizen Benefit: Senior citizens receive up to 0.40% p.a. additional interest on a Senior Citizen FD.
3. Market Independence: Returns remain unaffected by changes in stock markets or other market-linked investments.
4. Payout Choices: Investors can choose monthly, quarterly, half-yearly, annual, or maturity-based interest payouts.
5. Premature Withdrawal: Withdrawal is available under specified conditions, with interest reduction depending on the completed tenure.
6. Credit Ratings: Bajaj Finance Fixed Deposit carries CRISIL AAA/STABLE and [ICRA]AAA(Stable) ratings.

7. Loan Facility: Eligible investors can borrow up to 75% of their cumulative fixed deposit value.

   
   

These features allow investors to choose a deposit structure matching their income requirements and investment period.

Fixed deposits are mainly classified as cumulative and non-cumulative deposits based on how interest is paid.

1. Cumulative fixed deposit

A cumulative fixed deposit reinvests the earned interest instead of paying it periodically. The principal and accumulated interest are paid together at maturity. Compounding can provide a higher maturity amount over longer tenures.

2. Non-cumulative fixed deposit

A non-cumulative fixed deposit pays interest monthly, quarterly, half-yearly, or annually. The monthly option suits investors seeking regular income. Payout-specific interest rates may differ from cumulative rates offered at maturity.

How much monthly interest can you earn on Rs. 40 lakh FD?

Bajaj Finance offers cumulative rates up to 7.75% p.a. for customers below 60 and 8.15% p.a. for senior citizens. However, monthly payouts use separate non-cumulative rates. These rates are 7.16% p.a. and 7.49% p.a., respectively. Use this formula to estimate the monthly interest:

Monthly interest = Principal amount × Applicable monthly payout rate ÷ 12

The following table shows the estimated monthly income from a Rs. 40 lakh Bajaj Finance Fixed Deposit:

For example, the monthly interest for a customer below 60 is calculated as follows:

Monthly interest = Rs. 40,00,000 × 7.16% ÷ 12

Monthly interest = Rs. 23,866.67

These rates apply from 1 May 2026. Actual monthly payouts may vary slightly due to completed days and payout dates.

Factors that influence FD rates

Financial institutions consider several economic and business factors when setting fixed deposit interest rates.

Important factors include:

1. RBI Policy Rates: Changes in the repo rate can influence prevailing deposit and lending rates.
2. Funding Requirements: Institutions may revise deposit rates according to their funding needs and available liquidity.
3. Market Competition: Banks and NBFCs may adjust rates while competing for customer deposits.
4. Deposit Tenure: Different tenure ranges can carry different interest rates.
5. Payout Frequency: Monthly payout rates may differ from rates offered for cumulative deposits.
6. Investor Category: Senior citizens may receive additional interest over fixed deposit rates offered to customers below 60.

7. Rate Revision: Institutions may change rates for new deposits based on prevailing conditions.

   
   

Once booked, the applicable Bajaj Finance Fixed Deposit rate remains fixed for the selected tenure.

TDS on Rs. 40 Lakh Fixed Deposit

Interest earned from a fixed deposit is taxable according to the investor’s applicable income-tax slab. Bajaj Finance is an NBFC. TDS applies when total interest from the company exceeds Rs. 10,000 during a financial year. TDS is generally deducted at 10% when the investor provides a valid PAN. The rate increases to 20% without PAN. A Rs. 40 lakh fixed deposit will normally earn interest exceeding the NBFC threshold during a full financial year.

For example, annual interest at a 7.16% monthly payout rate equals Rs. 2,86,400 before TDS. A 10% TDS deduction would equal Rs. 28,640, subject to applicable tax rules and available declarations. TDS is deducted at interest credit or payment, whichever occurs earlier.

How to calculate interest on an FD of ₹40 Lakhs?

You can estimate monthly income using the investment amount and the applicable monthly payout rate.

Follow these steps:

Step 1: Enter the investment amount

Enter Rs. 40 lakh as the principal amount in the fixed deposit calculator.

Step 2: Select the investor category

Choose whether the investor is below 60 or qualifies as a senior citizen.

Step 3: Choose the tenure

Select a tenure between 12 and 60 months according to your financial requirement.

Step 4: Select monthly payout

Choose the non-cumulative monthly payout option to estimate regular interest income.

Step 5: Review the estimated return

Check the monthly interest, total interest, and principal payable at maturity.

The simple formula for estimating monthly interest is:

Monthly interest = Principal × Monthly payout rate ÷ 12

Example: Calculating interest on a ₹40 lakh FD

Example: Calculating interest on a Rs. 40 lakh fixed deposit

Assume a customer below 60 invests Rs. 40 lakh for 36 months. The applicable monthly payout rate for the 31-to-60-month tenure is 7.16% p.a.

Monthly interest = Rs. 40,00,000 × 7.16% ÷ 12

Monthly interest = Rs. 23,866.67

Therefore, the investor can receive approximately Rs. 23,866.67 monthly before TDS.

Total interest earned over the tenure

Multiply the monthly interest by the total number of monthly payouts.

Total interest = Rs. 23,866.67 × 36

Total interest = approximately Rs. 8,59,200

The principal amount of Rs. 40 lakh is returned at maturity, subject to the deposit remaining active throughout the tenure. Actual calculations can vary slightly because of payout dates, completed days, leap years, and the institution’s calculation method.

A Rs. 40 lakh fixed deposit can provide regular monthly income through a non-cumulative payout option. With Bajaj Finance Fixed Deposit, monthly income currently ranges from Rs. 21,366.67 to Rs. 24,966.67 before TDS. The exact amount depends on the tenure, investor category, and rate available when the deposit is booked. Review the monthly payout rate instead of using the cumulative rate for income calculations. Also consider taxation and premature withdrawal conditions.