Those planning to earn a reliable income by placing funds in the bank through a fixed deposit (FD) may want to pay attention to this news. The State Bank, Indian Bank, has increased interest rates on two of its special FD schemes. The bank raised the rate by 0.15 percent, which is 15 basis points, for the 'Ind Grow' scheme with a term of 555 days and the 'Ind Prosper' scheme with a term of 777 days. These new rates came into effect on October 23, 2026, ensuring clients receive a higher percentage compared to previous terms.
Interest Rate for 555 and 777 Day FDs
Indian Bank has increased the rates for both products by 15 basis points. As a result, the new annual interest rate for the 'Ind Grow' scheme for 555 days is 6.80%, and for the 'Ind Prosper' scheme for 777 days, it is 6.75%. Clients considering opening an FD for these fixed terms can benefit from the increased rates.
Bank's Decision Following Repo Rate Change
The increase in deposit rates was adopted by Indian Bank against the backdrop of the Reserve Bank of India's (RBI) increase in the repo rate. At the beginning of the current month, the repo rate was raised from 5.25% to 5.50%. Following this, Indian Bank announced an increase in interest on these two special savings programs. Nevertheless, before finalizing an FD, investors should consider not only the interest rate but also the investment term, early withdrawal conditions, and their financial needs.
Higher Percentage for Senior Citizens
Indian Bank typically provides pensioners with an additional 0.50% interest compared to regular customers. For super-seniors, this bonus is 0.75%. Eligible senior and super-senior citizens can also receive an extra percentage on these special fixed-term schemes. Therefore, before opening an FD, it is necessary to clarify the applicable interest rate at the bank based on age to know exactly what income will be received on the deposited amount.
Taxes on Fixed Deposit Interest
Investors depositing funds in FDs should remember that not all earned interest is fully tax-exempt. Income from interest is usually classified as 'income from other sources' and is included in the investor's total taxable base. Taxation is determined according to the investor's tax burden. This means that people with high tax rates may pay more tax on interest, while investors with low rates will face relatively lower taxes. Furthermore, the bank may withhold TDS (Tax Deducted at Source) according to applicable rules and criteria.
What to Consider Before Investing?
If you plan to open an FD in these Indian Bank programs, you can consider the annual rate of 6.80% for the 'Ind Grow' scheme for 555 days and 6.75% for the 'Ind Prosper' scheme for 777 days. However, the optimal choice depends on your investment horizon, cash needs, and tax status. It is important to remember that the stated interest rate may differ from the actual yield. The FD term, interest payout method, and tax aspects affect your profit. Therefore, always check the bank's terms and interest rates before investing.