SBI Fixed Deposit and Recurring Deposit Interest Rates: Looking to grow your savings in 2026? You might be considering options like Fixed Deposits (FDs) and Recurring Deposits (RDs) offered by the State Bank of India (SBI). These two investment avenues are popular for their reliability and steady returns. But how much can you actually earn from them this year?
Let’s dive into the interest rates and how these deposits can help you meet your financial goals.
What Are SBI Fixed and Recurring Deposits?
SBI’s Fixed Deposits (FDs) and Recurring Deposits (RDs) are savings options that allow you to earn interest on your money with little risk.
- Fixed Deposits (FDs): You lock your money in for a specific period (from 7 days to 10 years), and in return, SBI pays you a fixed interest rate.
- Recurring Deposits (RDs): You make monthly contributions for a fixed tenure (6 months to 10 years), and SBI pays you interest on the total amount you’ve saved.
Both options are low-risk and ideal for individuals who prefer predictable returns over the long term. Let’s break down the current interest rates in 2026.
How Much Can You Earn from an FD or RD in 2026?
In 2026, SBI offers a variety of interest rates based on the type of deposit and tenure. Here’s a quick look at the rates:
Fixed Deposit Rates
- For General Citizens: 3.00% to 7.00% per annum
- For Senior Citizens: 3.50% to 7.50% per annum
Recurring Deposit Rates
- For General Citizens: 3.00% to 6.50% per annum
- For Senior Citizens: 3.50% to 7.00% per annum
The rates can vary based on how long you decide to keep your money invested. Longer tenures usually offer higher rates, making them a better choice for those who can afford to lock away their funds for a while.
How Fixed Deposits and Recurring Deposits Work?
Fixed Deposit (FD) – The Basics
With an FD, you deposit a lump sum amount with the bank for a fixed tenure, and you’ll earn a predetermined interest rate. For example, if you invest ₹1,00,000 in a 5-year FD at 7%, you’ll earn ₹35,000 in interest by the end of the term (not including tax).
Recurring Deposit (RD) – The Basics
An RD works differently because you contribute a fixed amount every month instead of a lump sum. If you choose a ₹5,000 monthly deposit for 2 years at 6%, you’ll have invested ₹1,20,000, and you’ll earn interest on the total amount over time.
Both deposits have penalties for early withdrawals, so they’re best suited for people who don’t need immediate access to their funds.
Best Tips to Make the Most of SBI FDs and RDs
If you’re looking to maximize the returns from your FD or RD, consider these tips:
- Choose the Right Tenure: Longer tenures usually offer better interest rates. But only lock your money away if you’re comfortable with not accessing it for several years.
- Consider Senior Citizen Rates: If you’re over 60, take advantage of the higher rates offered for senior citizens. Even a small difference can add up over time.
- Stay Informed About Taxation: Interest earned on FDs and RDs is taxable. TDS (Tax Deducted at Source) applies if your interest income exceeds ₹40,000 in a year (₹50,000 for seniors). Keep this in mind while calculating your overall returns.
- Avoid Early Withdrawals: Both FDs and RDs charge penalties for early withdrawals. If you need liquidity, consider other options like savings accounts or liquid funds.
Breaking Down the Numbers: How Much You Can Earn
Let’s look at an example to see how much you can earn based on different deposit types and tenures.
| Deposit Type | Interest Rate (General) | Amount Invested | Tenure | Interest Earned | Total Amount at Maturity |
|---|---|---|---|---|---|
| Fixed Deposit | 7.00% | ₹1,00,000 | 5 years | ₹35,000 | ₹1,35,000 |
| Recurring Deposit | 6.00% | ₹5,000/month | 2 years | ₹19,200 | ₹1,19,200 |
As you can see, FDs tend to give a higher return for a lump sum investment, while RDs are better suited for smaller, regular contributions.
The Latest Updates in SBI FD and RD Interest Rates
Interest rates are regularly updated by banks, including SBI. As of 2026, the rates are influenced by inflation, RBI policies, and other economic factors. So, if you’re considering opening an FD or RD, it’s essential to check the latest rates. Rates can change, and you wouldn’t want to miss out on a better return if you’re flexible with your investment tenure.
Conclusion
Choosing between an FD and an RD depends on your financial goals and investment style. If you have a lump sum amount to invest and don’t need immediate access to it, an FD is the way to go. On the other hand, if you’re looking to invest small amounts regularly and prefer flexibility, an RD is a great choice.
In either case, both FDs and RDs offer a safe, reliable way to grow your money. Just be sure to choose the deposit that aligns best with your financial situation and goals in 2026.
FAQs
When can I withdraw my FD or RD?
You can withdraw an FD after its maturity period, but early withdrawals are penalized. RDs also lock you in for the chosen tenure, and withdrawing early results in penalties.
Why are RD rates lower than FD rates?
RDs involve regular monthly deposits, while FDs require a lump sum investment. FDs offer a higher return due to the larger upfront investment.
How is interest on FDs and RDs taxed?
Interest earned on FDs and RDs is subject to tax. TDS is deducted if your interest income exceeds ₹40,000 in a year (₹50,000 for senior citizens).