New Delhi: Indian Bank has revised interest rates on two special fixed deposit (FD) schemes following the Reserve Bank of India’s (RBI) recent repo rate increase, giving depositors an opportunity to earn slightly higher returns on select tenures. The revised rates came into effect on October 23, 2026, and apply to the bank’s 555-day Ind Grow and 777-day Ind Prosper deposits.
The revision comes after the RBI raised the repo rate by 25 basis points, from 5.25% to 5.50%, on October 7. While the move has raised expectations of higher deposit rates across the banking sector, banks are responding at different speeds. Several major lenders continue to offer their existing FD rates, with the highest advertised returns varying according to deposit tenure and customer category.
Indian Bank revises rates on two special FD schemes
Indian Bank has increased the interest rate on its 555-day Ind Grow fixed deposit from 6.65% to 6.80% per annum. The rate on its 777-day Ind Prosper deposit has risen from 6.60% to 6.75% per annum.
Both schemes have received an increase of 15 basis points. One basis point is equal to 0.01 percentage point.
The revised rates offer a marginally better return to customers choosing these specific deposit periods. However, the interest earned on an FD depends on the amount invested, the applicable rate, the tenure and the bank’s interest-payment method.
Depositors should also check whether the advertised rate applies to general customers or senior citizens, as banks commonly provide different rates for eligible senior citizens.
RBI repo rate rises to 5.50%
The RBI raised the repo rate by 25 basis points on October 7, taking it from 5.25% to 5.50%. The repo rate is the interest rate at which the central bank lends short-term funds to banks against eligible securities.
Changes in the repo rate can influence banks’ lending and deposit decisions. When borrowing costs rise, banks may adjust lending rates and offer more attractive deposit rates to attract funds. However, an RBI rate increase does not automatically require every bank to raise FD rates immediately or by the same amount.
Banks consider several factors before revising deposit rates, including their need for funds, liquidity position, competition and the maturity profile of their existing deposits. Consequently, customers may see different rates across lenders even after the same monetary policy announcement.
Existing fixed deposits generally continue at the contracted interest rate until maturity, subject to the terms of the deposit. The higher rates announced for new deposits do not automatically increase the returns on FDs booked earlier.
FD interest rates at major banks in October
Several large banks continue to offer fixed deposit rates of around 6.45% to 6.65% per annum at their highest advertised slabs for general customers. The exact rate depends on the tenure and the bank’s current schedule.
Here is a snapshot of the maximum rates highlighted in the October 2026 report:
| Bank | Maximum advertised FD rate |
|---|---|
| Indian Bank | 6.80% on the revised 555-day Ind Grow scheme |
| HDFC Bank | Up to 6.50% |
| State Bank of India (SBI) | Up to 6.45% |
| Axis Bank | Up to 6.50% |
| ICICI Bank | Up to 6.60% |
| Punjab National Bank (PNB) | Up to 6.50% |
| Kotak Mahindra Bank | Up to 6.65% |
These are headline rates rather than directly comparable returns for an identical deposit period. Indian Bank’s revised 6.80% rate applies to a specific 555-day scheme, while other banks’ maximum rates may apply to different tenures or products. Customers should check the latest official rate card before investing.
HDFC Bank’s highest rate in the report applies to deposits with tenures ranging from three years and one day to less than four years and seven months. SBI offers up to 6.45% for deposits with tenures of two years to less than three years.
Axis Bank offers up to 6.50% on selected tenures, while ICICI Bank’s reported maximum of 6.60% applies to eligible tax-saver deposits and certain longer-term FDs. Kotak Mahindra Bank’s advertised rates range from 2.75% to a maximum of 6.65%, depending on the deposit period.
The rates offered by these banks may change, and not every lender has revised its rates following the RBI’s October decision.
What depositors should check before booking an FD
A higher headline interest rate does not necessarily make a fixed deposit the best choice for every investor. Customers should compare the return for their preferred tenure rather than selecting a bank solely on the basis of its highest advertised rate.
The following points are worth checking before booking or renewing a deposit:
- Tenure: Compare rates for the same deposit period, such as one year, two years or three years.
- Senior citizen benefits: Eligible senior citizens may receive additional interest over the rate offered to general customers.
- Premature withdrawal: Check the bank’s rules and penalties if the money may be needed before maturity.
- Interest payout: Understand whether interest is paid periodically or compounded and paid at maturity.
- Tax implications: FD interest may be taxable according to the depositor’s applicable income-tax rules.
- Deposit protection: Check the applicable deposit-insurance limits and avoid treating every bank deposit as unlimited-risk-free.
Customers approaching the maturity date of an existing FD should compare the renewal offer with rates available for new deposits. Automatically renewing a deposit may mean missing a more suitable tenure or a better rate elsewhere.
Will banks raise FD rates further?
Further revisions remain possible, but the RBI’s repo rate increase alone does not guarantee that all banks will offer higher returns. Individual lenders may adjust rates depending on their funding requirements and competition for deposits.
For customers, the immediate development is Indian Bank’s increase on its 555-day and 777-day special deposits. The revised rates may be worth considering for those whose financial plans match these tenures, but the final decision should also take account of liquidity needs, tax treatment and the bank’s terms.
Before investing, depositors should verify the current rate on the relevant bank’s official website or branch, as advertised rates can change. The rate available on the day the deposit is booked, along with the selected tenure and applicable conditions, will determine the return.