Company deposit rates are climbing after the RBI's repo rate increase, according to reporting by Trade Brains. Bajaj Finance, Shriram Finance and other lenders are named, with rates up to 8.35%.
For you, the lesson is simple. A higher yield can tempt you, but safety should come first. Check the lender and its rating before you lock in your money.
Key takeaways
- Bajaj Finance, Shriram Finance and other lenders have raised deposit rates, as reported by Trade Brains.
- The highest rate mentioned is up to 8.35%.
- 'Up to' is the best case, not what every depositor gets.
- Company deposits usually pay more than bank FDs, but they carry more risk.
- Safety and rating matter more than the headline yield.
Why deposit rates rise after a repo rate hike
The repo rate is the rate at which the RBI lends money to banks. When it goes up, money becomes costlier for lenders. They then charge more on loans. To fund those loans, they need deposits, so they offer savers better rates. Non-bank lenders (called NBFCs) rely on deposits and market borrowing, so they often adjust quickly. That's why FD rates often follow a repo hike.
What changes for savers: a worked example
Say you put ₹1,00,000 in an FD for one year. At 7%, you earn about ₹7,000. At 8.35%, you earn about ₹8,350. Compounding adds a little more. The table below uses simple, round numbers.
| Deposit of ₹1,00,000 for one year | Example rate | Approx. interest |
|---|---|---|
| Lower-paying FD | 7.00% | ₹7,000 |
| Mid-range FD | 7.75% | ₹7,750 |
| Top rate in the report | 8.35% | ₹8,350 |
Only the 8.35% figure comes from the report. The other two rates are examples to show the gap. On ₹5,00,000, the gap between 7% and 8.35% is ₹6,750 a year. Interest is taxed at your slab rate, and tax may also be cut at source.
Who is affected
New depositors gain the most, because they can lock in the higher rate. If you already hold an FD, your rate stays the same until it matures. You may get the new rate when you renew.
Senior citizens often get a small extra rate on top. If you also have a loan, loan rates may rise too. Use the EMI calculator to see what a higher rate does to your payment.
What to do now
Don't rush. A higher rate is only worth it if your money is safe. Bank FDs up to ₹5 lakh per depositor per bank are insured by DICGC. Company FDs from non-bank lenders aren't covered by that insurance. A higher rate often signals higher risk.
Try this checklist before you book:
- Confirm the lender is on the RBI's list of registered NBFCs.
- Check the credit rating of the lender's FD programme.
- Ask which rate applies to your age and tenure.
- Compare it with the interest rates on other options.
- Don't put all your savings in one place.
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Frequently asked questions
Should I break my old FD to get 8.35%?
Usually not. Early withdrawal often brings a penalty that eats the gain. Work out the numbers first.
Is the 8.35% rate available to everyone?
No. 'Up to' means the best case. It may depend on tenure, amount or your age.
Are company FDs as safe as bank FDs?
Not quite. Bank deposits have DICGC insurance up to ₹5 lakh. Company FDs don't have it, so check the rating.
BankCreds analysis
This is good news for savers, but it's smaller than it looks.
Take a retired couple with ₹10 lakh. Moving from 7% to 8.35% adds ₹13,500 a year. At a 30% tax slab, that's about ₹9,450 after tax. Someone in a lower slab keeps more. It's useful, not life-changing.
What it doesn't mean
A higher rate isn't free money. If a company deposit fails, you could lose far more than ₹13,500. Insurance of ₹5 lakh covers banks only. Spreading money across lenders matters more than chasing the top rate.
Locking a longer tenure keeps today's rate if rates ease later. The same repo hike also makes loans costlier. If you borrow and save, check whether your extra interest covers your higher EMI.
This section is BankCreds' own assessment of what the development means for Indian borrowers and savers. It is independent commentary, not part of the source reporting above.
Sources & references
- Trade Brains — originating report https://tradebrains.in/money/fd-rates-hiked-after-rbi-repo-rate-increase-bajaj-finance-shriram-finance-and-more-check-who-offers-up-to-835-12671522
- Reserve Bank of India — repo rate is the rate at which the RBI lends to banks https://www.rbi.org.in/
- DICGC deposit insurance — bank deposits insured up to ₹5 lakh per depositor per bank https://www.dicgc.org.in/
- RBI list of registered NBFCs — where to confirm a non-bank lender is registered https://www.rbi.org.in/Scripts/BS_NBFCList.aspx
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Editorial note & disclaimer
How this was reported. The development above is attributed to the source or sources listed. BankCreds does not independently verify a third party's reporting; where a figure or a regulatory position is stated as fact, it is either attributed or drawn from the regulator's own published material. Everything under "BankCreds analysis" is our own assessment.
Rates and figures. Interest rates, per-gram values and premium bands quoted here are indicative, move daily, and differ by borrower profile, city and lender policy. Confirm the final number with the institution before you act on it — the sanction letter or policy schedule governs, not a news report.
Not financial advice. This article is general information for an Indian audience. It is not investment, tax, credit or insurance advice, takes no account of your circumstances, and BankCreds is not a lender, broker, distributor or advisor. Consider speaking to a SEBI-registered investment adviser or a qualified professional before acting.
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