Looking to lock in guaranteed returns—but not sure whether to pick a Post Office FD or a Bank FD?
You’re not alone. Fixed deposits are one of the most popular ways to grow your money safely in India. But when it comes to choosing between a post office FD and a bank FD, the differences can impact your returns, access, and convenience.
Let’s simplify the decision with a quick comparison across the key factors—so you can pick what suits your goals best.
Post Office FD vs. Bank FD: What's the Difference?
Both post office and bank FDs offer guaranteed interest and capital protection. But the real difference lies in the flexibility, interest rate advantages, digital convenience, and benefits for senior citizens.
Interest Rates: Who Offers More?
Post Office FDs: Government-fixed rates, currently ~7.5% for a 5-year term.
Bank FDs: Rates range from 5% to 9%, with some private banks offering higher returns.
Compare interest rates across tenures before locking in. Some bank FDs give you more room to choose what fits your target maturity.
Bajaj Finance, the biggest NBSC of India offers up to 7.30% p.a. interest rate on Fixed Deposits for senior citizens and flexible tenures starting from 12 months. Check FD Rates now!
Tax Benefits: What’s Deductible?
Both post office and bank FDs offer Section 80C tax-saving options on 5-year deposits. But:
- Only select bank FDs qualify.
- Interest earned is taxable under ‘Income from Other Sources’ in both cases.
Convenience: Online vs Offline
- Post Office FDs: Often require physical visits for deposits and renewals.
- Bank FDs: Fully digital—open, manage, renew or withdraw via app or net banking.
With Bajaj Finance, you can open your FD online in minutes—no branch visit, no paperwork. Open FD Account and get up to 7.30% p.a. returns.
Minimum Investment: What’s the Entry Point?
- Post Office: Start with Rs. 1,000.
- Banks: Start with as low as Rs. 1000 or Rs. 5,000, depending on the institution.
For small, recurring savers or first-time depositors, bank FDs offer more accessibility and customisation.
Tenure Flexibility: Who Wins?
- Post Office: Only 4 fixed terms – 1, 2, 3, or 5 years.
- Banks: From 7 days to 10 years—pick short-term or long-term as per your plan.
If you are looking for even more flexibility than check out Bajaj Finance FDs. It offers tenures from 12 to 60 months. You decide the maturity period that suits your goal. Check more details now.
Benefits for Senior Citizens: Who Cares More?
- Banks: Offer 0.25%–0.50% additional interest for seniors.
- Post Office: No extra benefit on FDs. Separate schemes like SCSS apply.
For senior investors looking for monthly income or higher returns, bank FDs are a more rewarding option.
Did you know?
Senior citizens can earn up to 7.30% p.a. interest with Bajaj Finance AAA rated FDs. Open an FD account today!
Safety: Government vs Insurance
- Post Office: Sovereign guarantee from the Government of India—complete safety.
- Bank FDs: Insured by DICGC up to Rs. 5 lakh per depositor, per bank.
Both are safe, but if 100% capital protection is your top priority, post office FDs give a slight edge.
Verdict: Which FD Works Best for You?
| Feature | Post Office FD | Bank FD |
| Interest Rate | Lower, but fixed | Higher, varies by bank |
