Best 3-Year FD Interest Rates In 2026: Bank-Wise Comparison

If you are looking for a secure place to grow your hard-earned money, the humble fixed deposit (FD) remains a classic choice. However, before you sign on the dotted line, it is essential to scan the horizon. While many believe longer tenures automatically mean better returns, the reality of 3-year FD interest rates in 2026 tells a more nuanced story.

Even a seemingly tiny gap in rates can lead to a significant difference in your pocket. For instance, an investment of Rs 10 lakh in a 3-year FD with an interest rate that is 0.50 percentage points higher can fetch roughly Rs 15,000 more over the tenure. In a market where every penny counts, comparing fixed deposit interest rates is the smartest financial move you can make.

The Private Sector Face-Off

The heavyweights of the private banking world are currently locked in a tight battle. HDFC Bank and ICICI Bank are currently offering identical rates on 3-year fixed deposits. Both giants pay 6.45% per annum to regular depositors, while senior citizen FD rates at these institutions stand at a more generous 6.95%.

Meanwhile, Kotak Mahindra Bank is trailing slightly behind. They offer 6.4% for regular depositors for the same tenure, with senior citizens earning 6.9%. While the 0.05% difference might look like pocket change, on a substantial corpus, it certainly adds up.

The Surprise Leader

If you are hunting for the best 3-year FD rates 2026 , you might want to look beyond the "Big Three." Federal Bank is currently stealing the limelight. With new rates effective from January 1, 2026, the bank is offering an impressive 6.75% to regular customers and a highly attractive 7.25% to senior citizens. This makes it one of the most lucrative options available for a three-year commitment.

Public Sector: Safety vs Returns

For those who prefer the sovereign-backed feel of public sector lenders, the returns are slightly more conservative. State Bank of India (SBI), the nation’s largest lender, currently offers 6.3% to regular depositors and 6.8% to senior citizens for a 3-year tenure. While SBI’s rates are a notch lower than private competitors, the bank’s massive scale remains a major draw for risk-averse savers.

On the other end of the spectrum, Union Bank of India is offering 6% to regular customers and 6.5% to senior citizens, based on rates applicable as of December 5, 2025.

Disclaimer: This article is for information purposes only. Banking charges and policies are subject to change based on regulatory guidelines and bank decisions. Customers are advised to check official bank communications or consult banking representatives for the latest updates before making financial decisions. Newspoint is not responsible for any financial decisions made based on this information.