PNB, Canara Bank Revise FD Rates; Senior Citizens Can Earn Up to 7.25%

Punjab National Bank and Canara Bank have revised their fixed deposit interest rates, with senior citizens eligible for higher rates on selected tenures. The changes come as banks adjust deposit pricing amid evolving liquidity and funding conditions.

For senior citizens, the revised rates can provide an additional return over the standard rates offered to other depositors. The maximum rate highlighted in the report is 7.25%, although the applicable rate depends on the bank, deposit tenure and eligibility conditions.

Changes in fixed deposit rates are closely linked to banks’ funding requirements. As competition for deposits increases, lenders may adjust term-deposit rates to attract stable retail funds and strengthen their liability profiles.

For banks, higher deposit rates can increase the cost of funds and potentially affect net interest margins. Treasury and asset-liability management teams therefore need to balance deposit mobilisation against the cost of raising funds and the expected return on deployed assets.

For customers, comparing the revised rates across banks and tenures is important because the highest advertised rate may apply only to a specific maturity period or customer category. Senior citizens should also consider premature-withdrawal rules, payout frequency and taxation before selecting a deposit.

The changes highlight the continuing relationship between deposit competition, liquidity conditions, funding costs and bank profitability.

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