The Bank of India (BOI) has recently updated its fixed deposit (FD) interest rates and also discontinued certain special schemes. These changes are crucial for both existing and potential depositors, as they directly affect the return on your investment.
In this detailed guide, we’ll walk you through the latest interest rate revisions, break down what’s been discontinued, and help you understand what this means for your savings. Whether you’re a first-time investor or a seasoned financial planner, this article provides everything you need to know in a clear, actionable format.
Bank of India Revises Fixed Deposit Interest Rates
| Aspect | Details |
|---|---|
| Revised Interest Rates | For deposits less than ₹3 Crore: 1 Year – 6.80% p.a.; 400 Days – 7.30% p.a.; Above 1 Year to Less than 2 Years (excluding 400 Days) – 6.80% p.a.; 2 Years – 6.80% p.a.; Above 2 Years to Less than 3 Years – 6.75% p.a.; 3 Years to Less than 5 Years – 6.50% p.a.; 5 Years to Less than 8 Years – 6.00% p.a.; 8 Years & Above to 10 Years – 6.00% p.a. |
| Senior Citizen Benefits | Additional 0.50% interest for those aged 60-80 years; Super senior citizens (80+ years) receive an extra 0.65% interest. |
| Discontinued Schemes | Specific maturity bucket of 333 days for amounts less than ₹3 Crore discontinued effective September 27, 2024. |
| Official Reference | Bank of India |
The latest updates from Bank of India present both opportunities and adjustments for depositors. The new 7.30% interest rate for 400 days is among the most attractive in today’s market. On the other hand, the withdrawal of the 333-day scheme means savers will need to re-evaluate their short-term options.
Whether you’re a senior citizen seeking safe returns or a young professional diversifying your portfolio, BOI’s revised FD offerings deserve a close look. Always plan based on your goals, risk appetite, and tax situation.
Understanding the Revised Interest Rates
Fixed deposits are a popular investment tool in India, especially for those looking for guaranteed returns with low risk. BOI’s recent changes reflect broader interest rate trends in the banking industry and aim to offer competitive returns for short and mid-term investors.
Detailed Breakdown of Revised Rates
For deposits less than ₹3 Crore, here are the updated interest rates:
- 1 Year: 6.80% per annum
- 400 Days: 7.30% per annum
- Above 1 Year to Less than 2 Years (excluding 400 Days): 6.80% per annum
- 2 Years: 6.80% per annum
- Above 2 Years to Less than 3 Years: 6.75% per annum
- 3 Years to Less than 5 Years: 6.50% per annum
- 5 Years to Less than 8 Years: 6.00% per annum
- 8 Years & Above to 10 Years: 6.00% per annum
Special Benefits for Senior Citizens
BOI offers additional interest to support senior investors:
- Senior Citizens (60-80 years): An extra 0.50% interest on deposits of less than ₹3 Crore for tenures of 6 months and above
- Super Senior Citizens (80+ years): An additional 0.65% interest on the same terms
Example: If a 70-year-old investor places ₹2 lakh in a 2-year FD, instead of earning 6.80%, they would earn 7.30% annually due to the additional benefit.
see also: Invest ₹5000 Every Month in Post Office RD Scheme
Discontinuation of Specific FD Schemes
BOI has withdrawn its 333-day FD scheme for deposits below ₹3 Crore. This scheme was discontinued as of September 27, 2024.
- What this means for you:
- You cannot open new FDs in the 333-day maturity bucket.
- If you already have such an FD, it will continue to earn the promised rate until maturity.
- For reinvestments, consider alternatives like the 400-day FD at 7.30%, which is now the highest offering for retail depositors.
Practical Advice for Depositors
Here’s how you can make the most of these changes:
1. Review Your Current FDs
Check if your FDs are affected by the revised rates. If you have an FD nearing maturity, compare your current rate with the revised ones and consider reinvesting in a higher-rate scheme.
2. Consider Reinvestment Options
The 400-day FD at 7.30% is an attractive option for short-term investors. Use online FD calculators to compare different tenures.
3. Use Senior Citizen Benefits
If you or your parents are eligible, always opt for the senior citizen FD rate, which adds up to 0.65% more depending on the age.
4. Plan for Tax Efficiency
FD interest is fully taxable. To reduce TDS:
- Submit Form 15G/15H if eligible
- Consider investing in 5-year Tax Saver FDs for deductions under Section 80C
5. Stay Updated with BOI Announcements
Interest rates may change again. For real-time updates, visit the official BOI FD page or contact your local branch.
see also: Post Office NSC: Invest ₹14 lakh and get great returns
Bank of India Revises Fixed Deposit Interest Rates FAQs
Q1: How do these new rates compare with other banks?
BOI’s 7.30% for 400 days is competitive. Some banks like SBI, HDFC, and IDFC First are offering similar special FDs. Always compare based on tenure and your financial goals.
Q2: Can I withdraw my BOI FD early?
Yes, premature withdrawal is allowed, but interest is reduced by a penalty margin (generally 1%). If you expect liquidity needs, choose short-term FDs or look into sweep-in accounts.
Q3: Is FD interest taxable?
Yes. FD interest is added to your income and taxed according to your slab. TDS applies if total interest exceeds ₹40,000 (₹50,000 for senior citizens) in a financial year.
Q4: How can I open or renew an FD at BOI?
You can:
- Visit any Bank of India branch
- Use BOI’s net banking or BOI Mobile app
- Provide KYC documents like PAN, Aadhaar, and a passport-sized photo
Q5: What’s the safest tenure for FD investment?
For those seeking stable and high returns, the 400-day or 1–2 year options are ideal right now. Avoid locking into very long-term FDs unless rates are expected to fall.
