Are you wondering how much you need to invest in SBI’s one-year Fixed Deposit (FD) to earn ₹31,990 interest? Whether you’re a beginner investor or a seasoned professional, understanding how SBI’s FD works can help you make smarter financial decisions. Let’s break it down in a simple, easy-to-understand guide so you can confidently plan your investments.
SBI One Year FD Gives ₹31,990 Interest
| Key Point | Details |
|---|---|
| SBI One Year FD Interest Rate (General Customers) | 6.50% per annum |
| SBI One Year FD Interest Rate (Senior Citizens) | 7.00% per annum (Additional 0.50% benefit) |
| Investment Needed to Earn ₹31,990 Interest | ₹4,92,154 (General), ₹4,56,857 (Senior Citizens) |
| Minimum Deposit Required | ₹1,000 |
| FD Tenure Discussed | 1 year |
| Interest Payout Options | Monthly, Quarterly, Half-Yearly, Yearly, or at Maturity |
Investing in SBI One Year FD to earn ₹31,990 interest is straightforward, but it requires a deposit of around ₹4.9 lakh (₹4.5 lakh for senior citizens). FDs are reliable, offer steady returns, and are ideal for risk-averse savers. However, don’t forget to factor in taxes and compare options for maximizing returns.
How SBI Fixed Deposits Work: A Quick Overview
A Fixed Deposit (FD) is one of the safest and most popular ways to grow your money in India. You deposit a lump sum amount with the bank for a fixed period and earn a guaranteed interest rate. Unlike market-linked products, there’s no risk of losing your money due to market fluctuations.
The State Bank of India (SBI), being India’s largest public sector bank, offers competitive FD interest rates, making it a trusted choice for millions of investors.
Why Choose SBI FD?
- Guaranteed returns with zero market risk.
- Flexible interest payout options.
- Senior citizens get an extra interest rate benefit.
- Easy to open online via SBI net banking/YONO app.
see also: Why Making Payments On Time Isn’t Enough For A Good CIBIL Score
How Much Do You Need to Invest to Earn ₹31,990 Interest?
Let’s get straight to the point.
For General Customers:
- Interest Rate: 6.50% p.a.
- Tenure: 1 year
- Required Investment: ₹4,92,154 approx.
Calculation:
Interest = Principal × Rate × Time / 100
₹31,990 = P × 6.5 × 1 / 100
P = ₹31,990 × 100 / 6.5
P ≈ ₹4,92,154
For Senior Citizens:
- Interest Rate: 7.00% p.a. (includes 0.50% extra)
- Tenure: 1 year
- Required Investment: ₹4,56,857 approx.
Calculation:
Interest = Principal × Rate × Time / 100
₹31,990 = P × 7 × 1 / 100
P = ₹31,990 × 100 / 7
P ≈ ₹4,56,857
Pro Tip: SBI compounds interest quarterly, but for simplicity, we’ve used annual calculations. Exact payouts may vary slightly due to compounding frequency.
Step-by-Step Guide to Open an SBI FD
Check Eligibility
- Any Indian resident, NRI, or senior citizen can open an FD.
- For minors, parents/guardians can open the account.
Decide Deposit Amount & Tenure
- Minimum deposit: ₹1,000.
- For ₹31,990 interest: Invest ₹4.9L (General) or ₹4.5L (Senior).
- Tenure options: 7 days to 10 years (here, 1 year focus).
Choose Interest Payout Option
- Monthly/Quarterly for regular income.
- Yearly or at maturity for higher returns.
Open Online or Visit Branch
- Use SBI Net Banking, YONO app, or walk into a branch.
Provide KYC Documents
- Aadhaar, PAN, Address proof, and recent photo required.
SBI FD Interest Rate Chart (As of March 2025)
| Tenure | General Interest Rate | Senior Citizen Rate |
|---|---|---|
| 7 days to 45 days | 3.50% p.a. | 4.00% p.a. |
| 46 days to 179 days | 4.75% p.a. | 5.25% p.a. |
| 180 days to 210 days | 5.75% p.a. | 6.25% p.a. |
| 211 days to less than 1 year | 6.00% p.a. | 6.50% p.a. |
| 1 year to less than 2 years | 6.50% p.a. | 7.00% p.a. |
| 2 years to less than 3 years | 6.75% p.a. | 7.25% p.a. |
Tax Implications on FD Interest
One important thing to note:
- FD interest is fully taxable as per your income tax slab.
- If interest earned exceeds ₹40,000 (₹50,000 for senior citizens) in a financial year, TDS (Tax Deducted at Source) @10% is applicable.
Tip: Submit Form 15G/15H if your total income is below the taxable limit to avoid TDS.
Should You Invest ₹4.9 Lakh in FD?
Financial planners recommend SBI FDs if:
- You need guaranteed returns without market risk.
- You prefer short-term saving goals like travel, emergency fund, or large purchases.
- You’re a senior citizen looking for stable income (opt for monthly/quarterly payouts).
However, consider alternatives if:
- You want to beat inflation in the long term.
- You can take some risk and opt for Mutual Funds, PPF, or other investment tools.
see also: Earn ₹83,000 Return on 777-Day Investment
Common Mistakes to Avoid
- Ignoring TDS impact — Keep post-tax returns in mind.
- Opting for cumulative payout without needing lump sum — Choose regular payouts if income flow is needed.
- Not comparing FD rates across banks — Some private banks offer slightly higher rates.
- Failing to submit 15G/15H when applicable — Can result in unwanted TDS deduction.
SBI One Year FD FAQs
Q1. What is the minimum deposit amount for SBI FD?
₹1,000 is the minimum deposit required.
Q2. Can NRIs invest in SBI Fixed Deposits?
Yes, NRIs can invest under NRE/NRO FD schemes.
Q3. Is premature withdrawal allowed?
Yes, but SBI may charge a penalty of 0.50%-1% on the applicable interest rate.
Q4. How is FD interest taxed?
It is fully taxable under ‘Income from Other Sources.’ TDS applies if interest exceeds ₹40,000 (₹50,000 for seniors).
Q5. How can I avoid TDS on FD interest?
Submit Form 15G (below 60 years) or Form 15H (senior citizens) if income is below taxable limit.
