Senior Citizen FD
Definition
A fixed deposit that pays resident individuals aged 60+ a higher interest rate (commonly about 0.50% more); same DICGC cover and taxation as a regular FD, with extra tax relief.A senior citizen fixed deposit is a regular FD on which resident individuals aged 60 and above receive a preferential, higher interest rate — most banks offer around 0.50% more than the general rate, and some add a small extra for super-senior citizens (80+). DICGC deposit insurance (up to ₹5 lakh per bank) and the taxation rules are the same as a regular FD, but senior citizens benefit from a higher TDS threshold (₹1,00,000 in FY2025-26) and the Section 80TTB deduction of up to ₹50,000 on interest income. The senior rate generally applies to resident deposits only, not NRE/NRO/FCNR.
Related guides
Related terms
- Fixed Deposit (FD) — A deposit that locks a sum with a bank for a fixed term at a pre-agreed interest rate.
- TDS (Tax Deducted at Source) — Income tax that a payer deducts before paying interest or other income, and deposits with the government.
- Premature Withdrawal — Closing or partly withdrawing a fixed deposit before maturity; the bank recalculates interest for the period held and deducts a penalty. Tax-saving FDs are generally locked in.
Definitions are general and educational — not advice. Verify current rates, limits and thresholds with the provider or the RBI/SEBI before acting. See our editorial policy.