Make your Rakhi gift a bit unique! Open a fixed deposit (FD) in a government bank in your sister's name and earn up to 8% interest..
People often buy clothes, jewelry, or other items as gifts for their sisters on Raksha Bandhan. However, if you wish to give something that offers long-term benefits, opening a Fixed Deposit (FD) in her name could be an excellent option. This is particularly advantageous if your sister—or any family member—is aged 80 or older, as certain FD schemes offer higher interest rates to this demographic compared to general customers.
Public sector lender Punjab National Bank (PNB) revised its FD interest rates effective June 1, 2026. Under the bank's standard domestic FD scheme, super senior citizens (customers aged 80 years and above) can earn up to 7.40% interest on specific tenures. Meanwhile, the 'PNB Uttam' non-callable FD scheme offers up to 7.50% interest to super senior citizens for certain tenures. While this presents an opportunity to earn returns close to 8%, the current official rates do not quite reach the 8% mark.
What interest rates does PNB offer on FDs?
PNB has set varying interest rates for different tenures on domestic term deposits of less than ₹3 crore for super senior citizens. Rates effective from June 1, 2026:
3.80% interest on FDs of 7 to 45 days
5.30% interest on FDs of 46 to 90 days
5.70% interest on FDs of 91 to 154 days
6.35% interest on 155-day FDs
7.05% interest on 1-year FDs
7.10% interest on tenures exceeding 1 year up to 389 days
7.40% interest on 444-day FDs
7.30% interest on 666-day FDs
7.15% interest on tenures exceeding 3 years up to 1203 days
6.80% interest on tenures exceeding 5 years up to 10 years
This means that even for long-term deposits, super senior citizens enjoy the benefit of higher interest rates compared to regular customers.
Returns of up to 7.50% on PNB Uttam FD
For customers wishing to deposit larger amounts, PNB’s 'Uttam Non-Callable FD' offers an alternative option. This scheme applies to deposits exceeding ₹1 crore but less than ₹3 crore. Unlike standard FDs, this scheme does not offer a premature withdrawal facility; consequently, the interest rates for certain tenures are set higher.
Effective June 1, 2026, super senior citizens earn 7.50% interest on 444-day FDs, 7.40% on 666-day FDs, 7.15% on 1-year FDs, and 7.20% on certain tenures exceeding one year under this scheme. Interest rates reach up to 7.25% for specific tenures exceeding three years. ([PNB][1])
When is 8% interest available?
The maximum interest rate on the bank's standard FDs ranges from approximately 6.40% to 6.60%. In contrast, super senior citizens can earn up to 7.40% interest on FDs with specific tenures. However, certain government or corporate options linked to PNB may offer returns of 8% or higher. Be sure to understand the terms and risks associated with these investments before proceeding; essentially, you can benefit by investing in these options as well.
Merely looking at the interest rate is not enough when investing in a Fixed Deposit (FD); you should select an FD based on the tenure for which you intend to keep the funds. If you might need the money before maturity, exercise caution when choosing a non-callable FD. Also, keep in mind the tax implications regarding the interest income earned.
Disclaimer: This content has been sourced and edited from News18 Hindi. While we have made modifications for clarity and presentation, the original content belongs to its respective authors and website. We do not claim ownership of the content.
