Union Bank of India revises fixed deposit rates – Check new FD rates across tenors!

Union Bank of India has revised its fixed deposit rates for general and senior citizen customers, with effect from June 10, 2024, according to the PSU bank’s website.

Union Bank of India’s fixed deposit rates start from 2.75% and go up to 7.60% per annum for general customers. The  rates are applicable on bulk deposits of more than Rs 2 crore. The tenures range from 7 days to up to 10 years. The bank offers senior citizens 0.5% additional interest and super senior citizens 0.75% extra.

Its lowest fixed deposit rate of 2.75% is applicable on FDs of 7 days to 14 days tenure. The PSU bank offers its highest interest rate of 7.60% for general customers subscribing to fixed deposits booked for 1 year. On the same tenure FDs, the bank offers 50 basis points or 0.50% additional interest rate to senior citizens. Super senior citizens, 80 and above age, are being offered 0.75% or 75 bps extra.  

Also read: Senior Citizen Fixed Deposits offering up to 9.50% return in June – Check latest FD rates

The bank’s highest tenure fixed deposit has a tenure of 10 years, which attracts an interest rate of 5.25% for general customers and 6% for super senior citizens.

“Union Bank of India offers an additional rate component to resident senior and super senior citizens on term deposits up to Rs 5 crores in all of its domestic term deposits schemes. The additional rate component, applicable to resident senior citizen deposits is 0.50% over and above the normal rates…,” the bank’s website said.

The bank, however, said that interest rates are subject to change from time to time. The interest is calculated on a daily basis and is credited on a quarterly basis every year in the months of April, July, October and January.

Usually, most public sector banks offer lower rates than small finance banks and non-bank lenders, though people still prefer to invest in PSU bank FDs. The reason is public sector banks have government backing and a wider presence across the country, which gives customers an assurance that their money is safe.

Small finance banks offer better rates than PSU banks on fixed deposits because the former faces a tough competition in terms of building a customer base. On top of that, they have to function with smaller capital bases. In a bid to compete with bigger rivals, small finance banks also do unsecured lending. Giving credit facilities to riskier segments of the population makes them prone to defaults and non-performing assets. Besides, customers want to be sure that their fixed deposit is secured under the Deposit Insurance and Credit Guarantee Corporation (DICGC) scheme. DICGC covers deposits up to Rs 5 lakh. In case, a bank goes insolvent, fixed deposits up to Rs 5 lakh safe.