Bank FD Scheme : In today’s world, everyone dreams of becoming financially secure or even a millionaire. While some people aim to achieve this through business ventures, others prefer to grow their wealth using smart and stable investment strategies. One such safe and reliable option that has stood the test of time is the Fixed Deposit (FD). Especially for those who are risk-averse or new to investing, FDs continue to be a preferred choice due to their guaranteed returns, capital safety, and simplicity.
FDs are offered by both public and private sector banks, and they come with fixed tenures and pre-determined interest rates. Your money stays safe, and the returns are assured, regardless of market volatility. In recent months, several leading banks in India have revised their FD interest rates, and many of them are now offering attractive returns, particularly on 1-year fixed deposits. If you are planning to invest and earn solid returns with minimal risk, this might be the perfect time to lock in your funds in a 1-year FD.
Bank FD Scheme : How Much Can You Earn from a 1-Year FD in 2025?
Let’s take a simple example: If you invest ₹5,00,000 in a 1-year fixed deposit at a 6.25% annual interest rate, you can earn over ₹32,000 in interest. This means that on maturity, you’ll receive ₹5,32,031 — a guaranteed return with zero risk.
This figure may seem modest to some, but for those looking to preserve capital and earn consistent income, it’s a highly dependable option. Over time, even small differences in interest rates — say 50 basis points (0.50%) — can make a significant impact on your total returns, especially when the investment period or amount increases. Therefore, before choosing a bank, it’s advisable to compare FD interest rates across various institutions to ensure maximum gains.
Bank FD Scheme : Top Banks Offering the Highest 1-Year FD Interest Rates (as of August–September 2025)
Here’s a look at the latest FD interest rates offered by top public and private sector banks in India for a 1-year fixed deposit:
| Bank | Regular Citizens (%) | Senior Citizens (%) |
|---|---|---|
| HDFC Bank | 6.25% | 6.75% |
| ICICI Bank | 6.25% | 6.75% |
| Kotak Mahindra Bank | 6.25% | 6.75% |
| Axis Bank | 6.25% | 6.75% |
| Federal Bank | 6.40% | 6.90% |
| Union Bank of India | 6.40% | 6.90% |
| SBI (State Bank of India) | 6.25% | 6.75% |
As evident from the table above, Federal Bank and Union Bank of India are currently offering the highest interest rates for both general and senior citizens. Let’s now explore the offerings from individual banks in a bit more detail.
1. HDFC Bank FD Interest Rates
HDFC Bank, the largest private sector bank in India, is currently offering 6.25% per annum for regular customers and 6.75% for senior citizens on a 1-year fixed deposit. These rates were recently updated and are among the top offerings in the private banking segment.
For example, if a regular customer invests ₹5,00,000 for 1 year at 6.25%, the total maturity amount would be approximately ₹5,32,031, with ₹32,031 being the earned interest.
2. ICICI Bank FD Interest Rates
ICICI Bank offers a similar interest structure. For 1-year to 18-month FDs, regular depositors receive 6.25% and senior citizens earn 6.75%. Notably, ICICI Bank offers even better rates for 2-year or longer FDs, making it a good option for medium to long-term investors.
3. Kotak Mahindra Bank FD Interest Rates
Kotak Mahindra Bank has also revised its FD interest rates, effective from August 20, 2025. The bank offers 6.25% interest to regular citizens and 6.75% to senior citizens for 1-year deposits. This puts Kotak at par with HDFC and ICICI in terms of 1-year FD rates.
4. Axis Bank FD Interest Rates
Axis Bank offers 6.25% to the general public and 6.75% to senior citizens on 1-year FDs. These are competitive rates, and Axis is known for its convenient digital FD booking process, which may appeal to tech-savvy investors.
5. Federal Bank FD Interest Rates
Federal Bank is currently one of the top performers in terms of FD returns. From August 18, 2025, the bank offers 6.40% interest to regular citizens and 6.90% to senior citizens on 1-year fixed deposits. These rates are among the highest in the market and make Federal Bank a strong contender for short-term investors seeking better returns.
6. Union Bank of India FD Interest Rates
Union Bank, a leading public sector bank, is also offering 6.40% for regular depositors and 6.90% for senior citizens on 1-year FDs, effective from August 20, 2025. Given the bank’s government backing and high returns, this is a great option for those seeking both safety and profitability.
7. SBI (State Bank of India) FD Interest Rates
The country’s largest public sector bank, SBI, revised its FD rates on July 15, 2025. SBI now offers 6.25% interest to regular citizens and 6.75% to senior citizens for 1-year fixed deposits. Although not the highest, SBI’s trusted brand name and wide reach make it a reliable choice for many.
Which Bank Should You Choose for a 1-Year FD?
If you are solely focused on earning the highest interest on your 1-year investment, then Federal Bank and Union Bank of India currently lead the market with 6.40% (regular) and 6.90% (senior citizen) rates. For those who value brand reputation, HDFC, ICICI, and SBI offer stable returns with great customer service.
It’s essential to choose based on your needs — whether it’s higher returns, trust in the institution, digital ease, or additional benefits like quarterly payout options, loan against FD, or flexible premature withdrawal policies.
Final Thoughts
Fixed Deposits are ideal for conservative investors or those saving for short-term goals like a wedding, vacation, or emergency fund. The fact that you can earn over ₹32,000 in just one year on a ₹5 lakh deposit — without worrying about market fluctuations — is reason enough to consider FDs seriously.
As always, remember to verify the latest FD interest rates directly on the official bank websites or through RBI-approved financial portals before investing. Also, check if your FD qualifies for tax-saving benefits under Section 80C, if applicable.
With inflation concerns and uncertain markets, locking in a 1-year FD at attractive rates in 2025 could be a smart move for preserving and growing your wealth.
