FD Calculator — Fixed Deposit Maturity

How to Use the FD Calculator

Enter your fixed deposit details using the three sliders:

• Principal Amount (₹): The amount you're depositing in the FD. This can range from as low as ₹1,000 (minimum for most banks) to several crores.
• Annual Interest Rate (%): The interest rate offered by your bank for the chosen tenure. Check your bank's website for current FD rates — they vary by bank, tenure, and whether you're a regular or senior citizen customer.
• Tenure (months): How long you plan to keep the FD invested. Tenures range from 7 days to 10 years. Most banks offer their best rates for 1–3 year FDs.

The calculator instantly shows your maturity amount, total interest earned, and a quarter-by-quarter interest schedule. This calculator computes cumulative FDs — interest is compounded quarterly and paid at maturity along with the principal.

FD Interest Formula — Quarterly Compounding

Indian banks apply quarterly compounding on fixed deposits, meaning interest is calculated and added to the principal every three months. The formula is:

A = P × (1 + r/4)^(4 × t)

Where:

• A = Maturity Amount (Principal + Interest)
• P = Principal (initial deposit)
• r = Annual interest rate (as a decimal, e.g. 7% = 0.07)
• t = Tenure in years
• 4 = Number of compounding periods per year (quarterly)

Total Interest Earned = A − P. The effective annual yield (EAY) from quarterly compounding is slightly higher than the stated nominal rate: EAY = (1 + r/4)⁴ − 1. For a 7% nominal rate, the effective yield is approximately 7.19% per annum.

FD Calculation Example

Suppose you deposit ₹5,00,000 in a fixed deposit at 7% per annum for 3 years (36 months).

• P = ₹5,00,000 | r = 0.07 | t = 3 years
• A = 5,00,000 × (1 + 0.07/4)^(4×3)
• A = 5,00,000 × (1.0175)^12
• A = 5,00,000 × 1.2314 ≈ ₹6,15,700
• Total Interest Earned ≈ ₹1,15,700

Notice how the effective return over 3 years (23.1%) is slightly higher than 3 × 7% = 21% — that's the benefit of quarterly compounding. The interest earned in each quarter becomes part of the new principal, earning its own interest in subsequent quarters.

For comparison: if the same bank offered simple interest at 7%, you'd earn only 5,00,000 × 0.07 × 3 = ₹1,05,000 — ₹10,700 less than quarterly compounding. Always confirm whether your FD uses simple or compound interest.

Frequently Asked Questions

How is FD interest calculated in India?

Indian banks compound FD interest quarterly by default for cumulative deposits. The standard formula is A = P × (1 + r/4)^(4t), where P is principal, r is the annual rate as a decimal, and t is tenure in years. Every quarter, interest earned in the previous quarter is added to the principal before the next quarter's interest is computed. This is why quarterly compounding yields slightly more than the simple annual rate would suggest.

What is the difference between cumulative and non-cumulative FD?

A cumulative FD reinvests the interest every quarter — you receive the full principal plus compounded interest only at maturity. This earns more in total. A non-cumulative FD pays out interest at regular intervals (monthly, quarterly, or annually) while leaving the principal invested. Non-cumulative FDs are preferred by retirees or others who need a regular income stream. For wealth accumulation, cumulative FDs are generally better.

Is FD interest taxable in India?

Yes, FD interest income is fully taxable at your applicable income tax slab rate in India, irrespective of whether you've actually received the interest or it's been rolled over. Banks deduct TDS at 10% when annual FD interest from a single bank branch exceeds ₹40,000 (₹50,000 for senior citizens). You must declare all FD interest income in your ITR under "Income from Other Sources." If you're in a zero-tax bracket, submit Form 15G (below 60 years) or 15H (60+) to your bank to prevent TDS deduction.

What is the highest FD interest rate in India in 2026?

FD interest rates change frequently based on RBI repo rate decisions and individual bank liquidity needs. As of 2026, small finance banks (SFBs) such as Unity Small Finance Bank, Suryoday SFB, and ESAF SFB typically offer among the highest rates — often 8–9.5% for specific tenures. Major PSU banks like SBI, PNB, and Bank of Baroda generally offer 6.5–7.5%, while private banks like HDFC, ICICI, and Axis fall in between. Senior citizens generally receive an additional 0.25–0.75% over regular customer rates. Always check directly with your bank for current rates before investing.

Can I break an FD before maturity?

Most Indian banks allow premature withdrawal of FDs, subject to a penalty. The penalty is typically a reduction of 0.5%–1% from the interest rate applicable to the tenure actually completed. For example, if you held a 3-year FD for 2 years and the 2-year rate is 6.5%, your effective payout rate would be 5.5%–6% after penalty. Tax-saver FDs with a 5-year lock-in under Section 80C cannot be prematurely withdrawn. Always check your bank's specific FD terms before investing.

Related Calculators