HDFC Bank, SBI FD interest rates vs Post Office Term Deposit rates

Many banks including private and government sector banks have hiked fixed deposit interest rates (FDs) of various tenures. This is good news for risk-averse individuals who have been stuck with decadal low-interest rates due to banks' continuous rate cuts in recent years.

At the same time, a fixed income option many turned to during this time was small savings schemes like the post office term deposits (POTD). Interest rates of post office small savings schemes have been kept unchanged for a while now, due to which they earn higher rates compared to bank FDs.

Here is a look at how the interest rates of SBI, HDFC Bank and POTD to stack up now.

HDFC Bank FD interest rates
HDFC Bank interest rates on FDs worth less than Rs 2 crore have been raised by 5-10 basis points. The new rates will go into effect on February 14, 2022. The bank has increased the 1-year FD interest rate by 10 basis points to 5% from 4.9% and 3 years to 5 years by 5 basis points to 5.45% from 5.40%. Click to read more on HDFC Bank hikes FD interest rates.


The State Bank of India (SBI) has increased interest rates on fixed deposits (FDs) for tenures above 2 years by 10-15 basis points with effect from February 15, 2022. Click to read more on SBI hikes interest rates of long-term FDs
According to the SBI website, for FD tenure of 2 year to less than 3 years, interest rate has been increased by 10 basis points to 5.20 percent, for 3 year to less than 5 year it has been hiked by 15 basis points to 5.45 percent. For FD tenure of 5 years and up to 10 years, the interest rate has been increased by 10 basis points to 5.50 percent. The new rates are applicable for FDs worth less than Rs 2 crore.

Post Office Term deposit interest rates
On deposit from one to three years, the Post Office offers a 5.5 percent interest rate. A 5-year term deposit account pays 6.7 percent. Interest is paid annually but calculated quarterly for these term deposits.

The minimum amount to be invested is Rs 1,000 and there is no maximum limit.
The deposit you made in the 5-year fixed deposit account qualifies for an income tax deduction under Section 80C of the Income Tax Act of India, 1961.
The tax may be deducted at source by the Post Office if the interest you earn on your FD account exceeds Rs.40,000 per financial year for regular customers.