Synopsis: This article discusses RBI holding the repo rate steady and its impact on FD rates across the country. It also lists the small finance, private sector, and public sector that offer high interest rates for the FDs.
The repo rate is the interest rate at which the Reserve Bank of India (RBI) lends short-term funds to commercial banks using government securities as collateral. It reflects the cost commercial banks incur to borrow money from the central bank. As the repo rate affects the blcost of borrowing for banks, it also influences interest rates for loans, fixed deposits, savings accounts, etc., throughout the financial system.
Did the RBI Change the Repo Rate in February 2026?
In its 6 February 2026 Monetary Policy Committee (MPC) meeting, the RBI decided to keep the repo rate constant at 5.25%, with no change from the previous policy meeting. This decision comes up after a series on reat cuts in the past years.
The central bank stated that inflation is mostly within acceptable levels. Further, growth outlooks are positive, backed by strong domestic demand and solid GDP performance. These are the reasons behind the RBI’s status quo
How Does the Repo Rate Influence Fixed Deposit Interest Rates?
When commercial banks borrow from the RBI at the repo rate, that rate becomes the standard for the overall cost of money in the system. Therefore, if the repo rate is lowered, borrowing becomes cheaper for banks and vice versa. When the repo rate is cut, it allows banks to cut their deposit rates, including FD rates. On the other hand, when the repo rate is high or stable, banks may tend to offer appealing FD rates to attract deposits.
That being said, FD rates do not change right after every RBI policy announcement. Banks set FD rates for specific time periods, so the rates get adjusted gradually instead of overnight changes. To keep or attract depositors, especially senior citizens, banks often delay rate cuts or keep higher rates even when the policy environment is softer.
Small Finance Banks Offering the Best FD rates for senior citizens in February 2026
1. ESAF Small Finance Bank
- Highest interest: 8.10%
- Highest slab tenure: 444 days
- 1-year FD: 5.25 %
- 3-year FD: 6.50 %
- 5-year FD: 6.25 %
- 10-year FD: 6.25 %
- Super senior benefit: None
2. Jana Small Finance Bank
- Highest interest: 8%
- Highest slab tenure: Above 2 years to 3 years
- 1-year FD: 7.50 %
- 3-year FD: 8 %
- 5-year FD: 7.77 %
- 10-year FD: 7 %
- Super senior benefit: None
3. Shivalik Small Finance Bank
- Highest interest: 8 %
- Highest slab tenure: 21 months 1 day to 22 months
- 1-year FD: 6.50 %
- 3-year FD: 7.25 %
- 5-year FD: 6.75 %
- 10-year FD: 6.75 %
- Super senior benefit: None
4. Suryoday Small Finance Bank
- Highest interest: 8%
- Highest slab tenure: 5 years
- 1-year FD: 7.45%
- 3-year FD: 7.45%
- 5-year FD: 8 %
- 10-year FD: 7.45%
- Super senior benefit: None
5. Utkarsh Small Finance Bank
- Highest interest: 8 %
- Highest slab tenure: 2 years to 3 years
- 1-year FD: 6.50 %
- 3-year FD: 8 %
- 5-year FD: 7.50 %
- 10-year FD: 7.25 %
- Super senior benefit: None
Private Sector Banks Offering the Best FD rates for senior citizens in February 2026
1. Bandhan Bank
- Highest interest: 7.70 %
- Highest slab tenure: 2 years to less than 3 years
- 1-year FD: 7.50 %
- 3-year FD: 7.50 %
- 5-year FD: 6.60 %
- 10-year FD: 6.60 %
- Super senior benefit: None
2. DCB Bank
- Highest interest: 7.65 %
- Highest slab tenure: 60 months to 61 months
- 1-year FD: 7.15 %
- 3-year FD: 7.25 %
- 5-year FD: 7.65 %
- 10-year FD: 7.25 %
- Super senior benefit: Additional 0.05 per cent on 37–38 months and 60–61 months for those aged 70 and above
3. RBL Bank
- Highest interest: 7.70 %
- Highest slab tenure: 18 months to 3 years
- 1-year FD: 7.50 %
- 3-year FD: 7.70 %
- 5-year FD: 7.20 %
- 10-year FD: 7.20 %
- Super senior benefit: Additional 0.25 per cent on all tenures
4. SBM Bank India
- Highest interest: 7.80 %
- Highest slab tenure: Above 18 months to less than 2 years 3 days
- 1-year FD: 7.50 %
- 3-year FD: 7.60 %
- 5-year FD: 7.50 %
- 10-year FD: 7.50 %
- Super senior benefit: None
5. YES Bank
- Highest interest: 7.75 %
- Highest slab tenure: 3 years to less than 5 years
- 1-year FD: 7.15 %
- 3-year FD: 7.75 %
- 5-year FD: 7.50 %
- 10-year FD: 7.50 %
- Super senior benefit: None
Public Sector Banks Offering the Best FD rates for senior citizens in February 2026
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1. Bank of India
- Highest interest: 7.20 %
- Highest slab tenure: 450 days under Star Swarnim
- 1-year FD: 6.75 %
- 3-year FD: 7 %
- 5-year FD: 6.75 %
- 10-year FD: 6.75 %
- Super senior benefit: Additional 0.15 % on tenures from 6 months to 10 years
2. Bank of Maharashtra
- Highest interest: 7.15 %
- Highest slab tenure: 400 days
- 1-year FD: 6.70 %
- 3-year FD: 5.75 %
- 5-year FD: 5.50 %
- 10-year FD: 5.50 %
- Super senior benefit: None
3. Indian Overseas Bank
- Highest interest: 7.10 %
- Highest slab tenure: 444 days
- 1-year FD: 7 %
- 3-year FD: 6.60 %
- 5-year FD: 6.60 %
- 10-year FD: 6.60 %
- Super senior benefit: Additional 0.25 % on all tenures
4. Punjab & Sind Bank
- Highest interest: 7.10 %
- Highest slab tenure: 444 days
- 1-year FD: 6.35 %
- 3-year FD: 6.35 %
- 5-year FD: 6.45 %
- 10-year FD: 6.35 %
- Super senior benefit: Additional 0.15 % on selected tenures
5. State Bank of India
- Highest interest: 7.05 %
- Highest slab tenure: 5 years to 10 years
- 1-year FD: 6.75 %
- 3-year FD: 6.80 %
- 5-year FD: 7.05 %
- 10-year FD: 7.05 %
- Super senior benefit: Additional 0.10 % on all tenures
Note: Fixed deposit rates and related details in this article are based on information published by Business Standard.
Conclusion
With the RBI keeping the repo rate steady in February 2026, interest rates in the banking system will be mostly stable. This is a positive development for senior citizens, as FD interest rates are not expected to drop suddenly in the near future.
This stability allows retirees to plan their income with more confidence. Ultimately, the important factor is to select the right tenure, check senior citizen premiums, and spread deposits across different banks to balance returns as well as safety.
Written by Nila Maria Jacob
