Bank of India's 500-Day FD: Is 7.50% Worth Your Money?

Bank of India launched a new 500-day fixed deposit scheme offering up to 7.50% interest for super senior citizens. Regular customers get 7.00%. Here's what this means for your savings in 2025.

Here's what happened: Bank of India launched the 500-day 'Star Akshay' Fixed Deposit scheme offering 7.00% for regular customers and up to 7.50% for super senior citizens (aged 80+).. The bank also revised interest rates across select standard tenures, making certain mid-term deposits more competitive than before.. This move follows a broader trend of public sector banks adjusting FD rates as RBI holds the repo rate and liquidity conditions shift in 2025..

What you should do: Compare Bank of India's 500-day rate (7.00%) with your current bank's equivalent tenure FD before renewing or booking a new deposit this month.. Check your age category — if you or a parent is 60+ or 80+, specifically request the senior or super senior rate at the branch, as it is not always applied automatically.. Calculate your post-tax FD return using your income slab — if you are in the 30% bracket, explore whether tax-free bonds or PPF offer a better effective yield before locking in..

FD interest is taxed annually even if you choose cumulative payout — split large deposits across family members in lower tax brackets to legally reduce your total tax outgo.