Fixed deposits are somehow comparatively safer investment options compared to equity. FDs offer guaranteed returns and higher interest rates than what savings accounts offer. Both State Bank of India (SBI) and Bank of Baroda (BoB) offer fixed deposit (FD) schemes of different interest rates. Both banks have launched special FD schemes. 

Investment in the 5-year FD provides tax benefits under Section 80C of the Income Tax Act, of 1961. Both SBI and BoB offer additional interest rates to senior citizens in their 5-year FD compared to the rates they offer to general citizens. Therefore, we will explore the SBI and BoB 5-year FDs and what will senior and general citizens get on Rs 8 lakh investment in each.

What is FD?
Fixed deposit is a type of investment where you invest money for a fixed period. You get maturity amount on the completion of the scheme. If you want to withdraw your deposit before the maturity date, you have to pay a penalty. Investors can also choose to receive interest payments at regular intervals, such as monthly, quarterly, or annually, or you can leave the interest to accumulate in your deposit till the maturity date. 

SBI 5-year general citizen FD interest rate
The interest rate is 6.50 per cent for general citizens. (Data source: Paisabazaar.com)

SBI 5-year senior citizen FD interest rate
The interest rate is 7.50 per cent for general citizens.

BoB 5-year general citizen fixed deposit rate
The bank offers a 6.50 per cent interest rate to general citizens in its 5-year FD.

BoB 5-year senior citizen FD interest rate
The Bank of Baroda is offering a 7.40 per cent interest rate to senior citizens in the 5-year FD.

SBI 5-year FD: Maturity amount for general citizens on Rs 8 lakh investment
An estimated corpus of Rs 11,04,336 will be generated on the investment of Rs 8 lakh in the 5-year fixed deposit.

SBI 5-year FD: Maturity amount for senior citizen on Rs 8 lakh investment
An estimated corpus of Rs 11,59,958 will be generated on the investment of Rs 8 lakh in the 5-year fixed deposit for senior citizens. 

BoB 5-year FD: Maturity amount for general citizens on Rs 8 lakh investment
At a 6.5 per cent interest rate, general citizens can accumulate estimated corpus of Rs 11,04,336 in Bank of Baroda’s 5-year FD. 

BoB 5-year FD: Maturity amount for senior citizen on Rs 8 lakh investment
With a 7.40 per cent interest rate, senior citizens can accumulate an estimated corpus of Rs 11,54,279 in the 5-year fixed deposit scheme.