Most of the main banks introduced Senior Citizens' Term Deposit schemes for senior citizens during the Covid-19 epidemic. On this programme, older folks receive higher interest rates in addition to the existing advantage of interest rates that are 50 basis points higher than the standard rates. Banks like HDFC Bank, ICICI Bank, IDBI Bank, SBI had introduced special fixed deposit schemes, but recently SBI has extended the validity period of its SBI 'WECARE' Senior Citizens' Term Deposit scheme till 31st March 2023.
However, HDFC Bank and IDBI Bank are set to end their special fixed deposit schemes for senior citizens from 1st October 2022. Let us check the interest rates offered by the HDFC and IDBI Bank's special fixed deposit schemes for older folks.
HDFC Bank Special FD
On 18 August 2022, HDFC Bank last modified the interest rates on fixed deposits under Rs2 Cr. The "Senior Citizen Care FD" was introduced by HDFC Bank on May 18, 2020, and it is active till 30 September 2022. This scheme has a 5 to 10-year of maturity term, for which HDFC Bank will offer an interest rate of 6.50%, which is 75 basis points higher than the standard rate of 5.75%.
HDFC Bank has said on its website that “An Additional Premium of 0.25% (over and above the existing premium of 0.50%) shall be given to Senior Citizens who wish to book the Fixed Deposit less than Rs5 crores for a tenure of 5 (five) years One Day to 10 Years, during special deposit offer commencing from 18th May'20 to 30th September 2022. This special offer will be applicable to new Fixed Deposit booked as well as for the Renewals, by Senior Citizens during the above period. This offer is not applicable to Non-Resident Indian."
For premature withdrawals of "Senior Citizen Care FD", HDFC Bank has stated on its website that In case of premature closure of Fixed Deposit booked in the above offer (including sweep in / partial closure) on or before 5 years, the interest rate will be 1.00% below the contracted rate or the base rate applicable for the period the deposit has remained with the bank, whichever is lower.
In case of premature closure of fixed deposit booked in the above offer (including sweep in / partial closure) post 5 years, the interest rate will be 1.25% below the contracted rate or the base rate applicable for the period the deposit has remained with the bank, whichever is lower."
Source: HDFC Bank website
IDBI Bank Special FD
The private sector lender IDBI Bank introduced its "IDBI Naman Senior Citizen Deposit" special fixed deposit programme for senior citizens on 20 April 2022. This special fixed deposit plan has maturities ranging from more than one year to ten years, and its validity term is from 20 April 2022 to 30 September 2022. Residents who are senior citizens will get an additional interest rate of 0.25% over and above the existing additional rate of 0.50% per annum on this special fixed deposit plan, making a total additional benefit of 0.75% over the card rate. The additional rate will be offered on freshly accounts as well as deposits renewed during the valid duration of the programme.
Source: IDBI Bank website
Senior citizens can also take advantage of special fixed deposit plans offered by ICICI Bank and SBI. "ICICI Bank Golden Years FD" is the special fixed deposit scheme provided by the bank as the name suggests and the scheme is valid till 7 October 2022. The scheme comes with a maturity tenure of 5 years 1 day, up to 10 years and on this special fixed deposit scheme, resident senior citizen customers will receive an additional interest rate on a fixed deposit of 0.20% in addition to the current additional rate of 0.50% per year under this special fixed deposit scheme.
Whereas, SBI has mentioned on its website that “A special “ SBI Wecare" Deposit for Senior Citizens introduced in the Retail TD segment wherein an additional premium of 30 bps (over & above the existing 50 bps as detailed in the above table) will be paid to Senior Citizen’s on their retail TD for '5 Years and above' tenor only. "SBI Wecare" deposit scheme stands extended up to 31 March 2023."