Fixed deposit is one of the safest investment avenues offered by banks, Non-Banking Financial Companies (NBFCs), and post offices. A post office fixed deposit, also known as a post office term deposit, is a fixed deposit issued by the Indian postal services. Post office fixed deposits are backed by the sovereign guarantee of the Government of India. The post office FD interest rates range from 6.90% p.a. – 7.50% p.a. for tenures ranging from 1 year to 5 years, offering investors stable growth.
Due to its backing by a sovereign guarantee provided by the Union Ministry of Finance, these FD schemes provide the highest level of capital protection and income predictability for depositors. These FD programs are run by the National Savings Institute, which is a division of the Department of Economic Affairs within the Union Ministry of Finance, just like other modest savings programs. Post Office Fixed Deposits (PO FD) are also referred to as National Savings Time Deposits as a result.
Post Office FD Rate 2023
Post office FD is a preferred investment option for a safe investment avenue. These post office FDs are backed by the sovereign guarantee of the Government of India.
Post office offers FD interest rate ranges between 6.90% – 7.50% p.a. for a tenure of 1 year to 5 years. The Post Office FD interest rate on tax saving FD is 7.50% for general citizens.
The below-mentioned table shows the updated Post Office FD interest rates 2023:
|Tenure||1, 2, 3 and 5 years|
|Minimum deposit amount||Rs. 1,000|
|Interest rates||6.90-7.5% p.a.
|Mode of payment||Cash/ cheque|
|Premature withdrawal||Allowed after 6 months*|
All interest rates shown above are as on 21 July 2023. Interest rates from 01.07.2023 to 31.09.2023 Disclaimer: Bajaj Finserv refrains from endorsing, rating, or recommending any specific insurer or insurance product provided by insurers.
Post office FD interest rates
The Government of India (every quarter) decides post office fixed deposit interest rates under ‘Small Saving Schemes’. These rates are, in turn, determined as per the performance of government securities/ bills. A post office fixed deposit with a tenure of 5 years has an interest rate mark-up of 25 bps over the yield of comparable government securities.
Note: All interest rates shown below are as on 21 July 2023. Interest rates from 01.07.2023 to 31.09.2023
Post office FD rates
|Tenure (years)||Post office FD interest rates|
|1 year||6.90% p.a.
|2 years||7.00% p.a.
|3 years||7.00% p.a.|
|5 years||7.50% p.a.|
If you open a fixed deposit with the post office for a tenure of 5 years, you will be eligible to claim tax benefits under Section 80C of the Income Tax Act, 1961.
Here is a comparison of the latest FD interest rates post offices against those offered by Bajaj Finance Limited.
|Tenure (years)||Post office FD interest rates||Bajaj Finance FD interest rates|
|1 year||6.90% p.a.
|2 years||7.00% p.a.
|3 years||7.00% p.a.||8.05% p.a.|
|5 years||7.50% p.a.||8.05% p.a.|
Senior citizens can get additional rate benefits of up to 0.25% p.a. Check the return you will get on Bajaj Finance Fixed Deposit with an FD interest calculator.
Features and benefits of Bajaj Finance Fixed Deposit
Here is a table of the features and benefits offered by Bajaj Finance.
|Interest rate||Up to 8.60% p.a|
|Minimum tenure||1 year|
|Maximum tenure||5 years|
|Deposit amount||Minimum deposit of Rs. 15,000|
|Application process||100% online process|
|Online payment options||Net banking and UPI|
Post Office FD: TDS implication/ taxation
One significant benefit of investing in post office FD is that (TDS*) isn't deducted on the interest earned.
While documenting Income Tax Return (ITR), one can add their investments of fixed deposit in post office to claim deduction u/s 80C of the Income Tax Act, 1961. The upper limit for deductions under the said section of the IT Act, 1961 is maxed at Rs. 1.5 lakh, every financial year.
Post office fixed deposit vs Bajaj Finance Fixed Deposit
Suppose you are thinking of redirecting the interest earned from the post office FD. In that case, you can consider an alternative option of investing in high-yielding companies that offer similar guarantees with zero to low risk on FD.
Even though post office FD may offer a higher interest rate than bank FD, it cannot match the interest rate provided by company FDs. You can ensure maximum returns on FDs guaranteed by well-financed and liquid companies like Bajaj Finance. Let us see how you can benefit even further with a Bajaj Finance FD.
- Investment rate – Bajaj Finance FD offers higher interest rates of up to 8.60% p.a., which is higher than any other fixed-income option given the current state of the economy. A post office FD will allow a maximum of 7.50% p.a., which can be further reduced if the government securities (G-sec) yield falls.
- Flexibility – Bajaj Finance FD offers flexible terms for premature withdrawal (compared to post office FD). It also provides an option to avail of loan against FD at a marginal interest rate.
- Ease of access – While a post office FD may not offer you many online features, you can easily invest in a Bajaj Finance online FD that enables you to reap the benefit of an end-to-end online paperless procedure. Additional features of doorstep document pickup, multi-deposit, and auto-renewal make it even more convenient. You can open a Bajaj Finance online FD account by just using a debit card at a few locations.
Bajaj Finance also accepts deposits from NRIs and is rated high on the safety and stability ranking, making it one of the best investment options for those with a lower risk appetite. To help you compare the features of post office fixed deposit and Bajaj Finance Fixed Deposit, here is a table detailing the differences between the two:
|Feature||Post office FD||Bajaj Finance FD|
|Quarterly interest rate revision||Yes||No|
|Flexible premature withdrawal||No||Yes|
|Online account management||No||Yes|
With a total deposit book size of more than 50000 crores, you can trust Bajaj Finance FD to give you maximum returns at little to no risk.
Calculate your expected investment returns with the help of our investment calculators:
|SIP Calculator||FD calculator||SDP calculator||Gratuity Calculator|