Best FD Rates For 3 Years 2026
A 3-year FD is a fixed deposit that locks in a fixed interest rate for exactly three years, offering safety and predictable returns. This guide compares the best 3-year FD interest rates from top banks and NBFCs in 2026 so you can maximise your earnings. Rates shown here are verified against each lender's official site.
Best 2026 FD Interest Rates for Below Rs.2 Crore for 3-Year Tenure
Bank/Company | Regular Interest Rate (per annum) | Senior Citizen Interest Rate (per annum) |
AU Small Finance Bank | 7.40% | 7.90% |
Shriram Finance | 7.50% | 8.00% |
Mahindra Finance FD | 7.40% | 7.75% |
Sundaram Finance FD | 7.25% | 7.75% |
Equitas Small Finance Bank FD | 7.10% | 7.60% |
Canara Bank FD | 6.25% | 6.75% |
Punjab and Sind Bank FD | 5.95% | 6.45% |
The Interest rates are subject to change and are revised by the banks and financial institutions from time to time.
Note: Interest rates updated on 18 August 2026.
Before comparing purely on rate, note that AU Small Finance Bank, Canara Bank, Punjab and Sind Bank and Equitas Small Finance Bank are banks whose deposits are insured up to the limit set by the Deposit Insurance and Credit Guarantee Corporation (DICGC), while deposits with NBFCs such as Shriram Finance, Mahindra Finance and Sundaram Finance do not carry this cover.
3-year Fixed Deposit Key Highlights
- Shriram Finance pays the highest interest rate of 7.50% p.a. for the 3-year FD opened by the general public.
- When 3-year term deposits are opened by senior citizens, Shriram Finance pays the highest interest rate of 8.00% p.a.
List of 7 Best FD schemes for 3 years
1. AU Small Finance Bank
- AU offers attractive rates of interest on the 3-year tenure
- They offer 7.40% p.a. to the general public and 7.90% to senior citizens.
- A number of flexible interest payout options and premature withdrawal are provided by the bank.
2. Shriram Finance
- The rate of interest offered for cumulative deposits for 3 years is 7.50% p.a. for general citizens and 8.00% p.a. for senior citizens.
- The fixed deposits are offered with flexible payout options like monthly, quarterly, half-yearly, yearly, or at maturity.
- Women depositors are offered an additional 0.50% p.a. on fixed deposits.
3. Mahindra Finance
- The best FD rate is offered for the Samruddhi Cumulative Deposit scheme, where the rate of interest is 7.40% p.a. with regard to general citizens
- For senior citizens, the interest rate offered is 0.35% higher for Samruddhi Cumulative Deposit Scheme
- The interest on these deposits is compounded on an annual basis
- Various interest payout options available
4. Sundaram Finance
- Promising FD schemes with attractive interest rates and other benefits
- An interest rate of 7.25% p.a. is offered to the general public who open a 3-year term deposit with the company
- Senior citizens are provided an interest of 7.75% p.a.
- Premature withdrawal and nomination facility available
5. Equitas Small Finance Bank
- The Equitas Small Finance Bank offers a fixed deposit at an interest rate of 7.10% p.a. for general citizens and 7.60% p.a. for senior citizens.
- The bank allows partial and full premature withdrawal of the fixed deposit.
- No penalty will be levied on premature withdrawal after six months of deposit.
6. Canara Bank
- Canara Bank offers an interest rate of 6.25% p.a. on FDs for a period of 3 years
- An interest rate of 6.75% p.a. is offered to senior citizens
- Premature withdrawal facility is available
- 1% penalty fee applicable on premature withdrawal of deposits below Rs.3 crore
7. Punjab and Sind Bank
- The rate of interest paid on Punjab and Sind Bank FDs for a 3-year tenure is 5.95% p.a.
- Individuals who fall in the senior citizen bracket can earn an interest rate of 6.45% p.a.
Summary
A 3-year FD offers a fixed, predictable rate of interest for three years, with NBFCs such as Shriram Finance and banks such as AU Small Finance Bank among the top payers for this tenure. Senior citizens earn an additional rate over the general public rate, and bank deposits carry DICGC insurance that NBFC deposits do not. Compare the current 3-year FD rates above and check each scheme's premature withdrawal terms before you invest.
FAQs on 3 Year Tenure FD Rates
1.What is a 3-year FD?
A 3-year FD is a fixed deposit that pays a fixed rate of interest for a locked tenure of exactly three years, with the deposit and interest usually paid out together at maturity. It suits savers who want predictable, low-risk returns over a medium-term horizon. Banks and NBFCs both offer 3-year FD schemes at rates that can differ significantly.
2.Why should I choose a 3-year FD tenure over a shorter or longer one?
A 3-year FD often earns a higher rate than shorter deposits while giving you access to your money sooner than a 5-year or 10-year lock-in. It suits medium-term goals such as a planned expense a few years away. Comparing 3-year FD rates across lenders before booking helps you get the best return for this tenure.
3.What is the difference between a bank 3-year FD and an NBFC 3-year FD?
A bank fixed deposit is opened with a scheduled bank, including small finance banks, while an NBFC fixed deposit is opened with a non-banking finance company that also offers 3-year FD schemes. Bank FDs are typically covered by deposit insurance up to the prescribed limit, whereas NBFC FDs are not. It is worth checking a scheme's credit rating before investing in an NBFC's 3-year FD.
4.How is interest paid out on a 3-year FD?
Interest on a 3-year FD can be credited to your savings account on a monthly, quarterly, half-yearly or annual basis, depending on the payout option chosen at booking. If you choose the cumulative or reinvestment option instead, the interest compounds and is paid with the principal only at maturity. The right choice depends on whether you need regular income or long-term growth from your 3-year FD.
5.Do senior citizens get a higher interest rate on a 3-year FD?
Yes, most banks and NBFCs pay senior citizens an additional interest rate on a 3-year FD over the rate paid to the general public. The exact additional rate varies by lender and is shown separately in each scheme's rate table. Senior citizens should compare the specific 3-year FD rates published for their age group before booking.
6.Will I get the full interest rate if I withdraw my 3-year FD before maturity?
No, a 3-year FD withdrawn before maturity usually earns a reduced interest rate and may attract a premature withdrawal penalty. The exact penalty and reduced rate depend on the bank or NBFC's policy at the time of booking. It is worth checking these terms before opening a 3-year FD if early access to funds is a possibility.
7.Is my money safe in a 3-year fixed deposit?
A 3-year FD is considered a low-risk investment because its interest rate stays fixed for the full tenure regardless of market movements. Deposits with banks are insured up to the limit set by the Deposit Insurance and Credit Guarantee Corporation (DICGC), while deposits with NBFCs do not carry this cover. Checking an NBFC scheme's credit rating is a useful safety check before investing in its 3-year FD.
8.What makes an NRO FD different from an NRE FD for a 3-year tenure?
An NRE (Non-Resident External) fixed deposit holds income earned outside India, while an NRO (Non-Resident Ordinary) fixed deposit holds income earned within India, such as rent or dividends. Both are available for a 3-year tenure with participating banks, but their taxation and repatriation rules differ. NRIs comparing 3-year FD options should pick the account type that matches the source of their funds.
9.Can a minor open a 3-year FD account?
Yes, a minor can generally open a 3-year FD through a parent or legal guardian who operates the account on the minor's behalf. Some banks also allow minors above a certain age to operate a fixed deposit independently, subject to the bank's own rules. It is best to check the minor-account policy of the specific bank before booking a 3-year FD.
10.Is the interest earned on a 3-year FD taxable?
Yes, interest earned on a 3-year FD is added to your total income and taxed at your applicable income tax slab rate. Banks and NBFCs deduct tax at source once your annual interest income crosses the prescribed threshold, unless you submit the relevant exemption form. It helps to factor this tax treatment into your return expectations when comparing 3-year FD rates.
11.Can I renew a 3-year FD after it matures?
Yes, most banks and NBFCs let you renew a matured 3-year FD for a fresh tenure, either automatically or on instruction, at the interest rate applicable on the renewal date. You can also choose to withdraw the maturity proceeds instead of renewing. Comparing current 3-year FD rates at the time of renewal helps you decide whether to continue with the same lender.
12.How do I choose the best 3-year FD scheme?
The best 3-year FD scheme is usually the one offering the highest interest rate for your depositor category from a bank or NBFC with a sound credit rating. It also helps to compare payout options, premature withdrawal terms and, for NBFCs, whether the scheme carries deposit insurance. Reviewing a comparison of top 3-year FD schemes makes it easier to shortlist the right one.
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