Savings Interest Rate Calculator – SBI, HDFC, IOB & More Banks
The savings interest rate calculator helps you calculate the interest earned on savings accounts across major Indian banks including SBI, HDFC Bank, ICICI Bank, IOB (Indian Overseas Bank), Post Office, and others. Compare interest rates, project earnings, and understand how compound interest grows your savings over time using accurate calculations based on current 2025 interest rates.
💰 Calculate Savings Account Interest
Select your bank or enter custom rate
Your Interest Calculation
Detailed Breakdown
| Description | Amount |
| Principal Deposit | ₹0 |
| Interest Rate (p.a.) | 0% |
| Time Period | 0 years |
| Interest Earned | ₹0 |
| Final Amount | ₹0 |
Current Savings Account Interest Rates in India (2025)
As of November 2025, savings account interest rates vary significantly across Indian banks. Here's a comprehensive comparison of major banks:
| Bank Name | Interest Rate (% p.a.) | Minimum Balance | Compounding |
|---|---|---|---|
| State Bank of India (SBI) | 2.70% | Varies by account type | Quarterly |
| HDFC Bank | 2.50% | ₹2,500 - ₹10,000 | Quarterly |
| ICICI Bank | 2.50% - 3.50% | ₹1,000 - ₹10,000 | Quarterly |
| Axis Bank | 3.00% - 3.50% | ₹10,000 | Quarterly |
| Kotak Mahindra Bank | 3.50% | ₹5,000 - ₹10,000 | Quarterly |
| Indian Overseas Bank (IOB) | 2.75% - 3.00% | ₹5,000 | Quarterly |
| Punjab National Bank (PNB) | 2.70% | ₹500 - ₹2,000 | Quarterly |
| Bank of Baroda | 2.75% - 3.35% | ₹500 - ₹1,000 | Quarterly |
| Canara Bank | 2.90% - 3.55% | ₹500 - ₹1,000 | Quarterly |
| Post Office Savings Account | 4.00% | ₹500 | Yearly |
| IDFC First Bank | 4.00% - 6.00% | ₹10,000 - ₹25,000 | Monthly/Quarterly |
| Yes Bank | 4.00% - 6.00% | ₹10,000 - ₹25,000 | Quarterly |
Note: Interest rates shown are effective as of November 2025 and subject to change. Many banks offer tiered rates based on account balance—higher balances often earn higher interest rates. Always verify current rates with your bank before making deposit decisions.
Savings Account Interest Calculation Formula
Understanding how savings account interest is calculated helps you maximize earnings and compare bank offerings effectively:
Compound Interest Formula
Standard Compound Interest Formula:
Where:
- A = Final amount (maturity value)
- P = Principal amount (initial deposit)
- r = Annual interest rate (as decimal)
- n = Number of times interest compounds per year
- t = Time period in years
Interest Earned Formula
Calculate Total Interest:
Interest earned equals final amount minus principal
Effective Annual Rate Formula
Effective Annual Rate (APY):
Shows actual annual return accounting for compounding
Example Calculation:
Given: Principal = ₹100,000, Rate = 3% p.a., Time = 5 years, Compounding = Quarterly
Calculation:
A = 100,000 × (1 + 0.03/4)^(4×5)
A = 100,000 × (1.0075)^20
A = 100,000 × 1.1612
A = ₹116,120
Interest Earned = ₹116,120 - ₹100,000 = ₹16,120
How Compounding Frequency Affects Returns
The frequency at which interest compounds significantly impacts total returns over time:
Compounding Comparison
For ₹100,000 at 3% annual interest over 10 years:
| Compounding Frequency | Times Per Year | Final Amount | Interest Earned |
|---|---|---|---|
| Yearly | 1 | ₹134,392 | ₹34,392 |
| Half-Yearly | 2 | ₹134,686 | ₹34,686 |
| Quarterly | 4 | ₹134,835 | ₹34,835 |
| Monthly | 12 | ₹134,947 | ₹34,947 |
| Daily | 365 | ₹134,985 | ₹34,985 |
Key Insight: More frequent compounding generates higher returns. However, the difference between quarterly (most common for Indian banks) and daily compounding is relatively modest—about ₹150 over 10 years on ₹1 lakh at 3%. Focus on finding the highest base interest rate rather than optimizing compounding frequency alone.
SBI Savings Account Interest Rate Details
State Bank of India, India's largest public sector bank, offers competitive savings rates:
SBI Interest Rate Structure
- Standard Rate: 2.70% p.a. for balances below ₹10 crore
- High Balance Rate: 2.70% p.a. for balances of ₹10 crore and above
- Compounding: Quarterly (every 3 months)
- Minimum Balance: Varies by account type and branch location
- Interest Calculation: Daily balance basis
SBI Account Types
- SBI Savings Bank Account: 2.70% with ₹3,000-5,000 minimum balance
- SBI Insta Plus Account: 2.70% with overdraft facility
- SBI Basic Savings Account: 2.70% with zero minimum balance
- SBI Savings Plus Account: Auto-sweep facility for higher returns on excess funds
HDFC Bank Savings Account Interest Rate Details
HDFC Bank, India's leading private sector bank, provides transparent savings account interest:
HDFC Interest Rate Structure
- Uniform Rate: 2.50% p.a. across all account balances
- Compounding: Quarterly
- Interest Calculation: Daily balance method
- Minimum Balance: ₹2,500 to ₹25,000 depending on account variant and location
- Credit Frequency: Interest credited quarterly
HDFC Account Variants
- Regular Savings Account: ₹10,000 minimum balance (urban), lower for semi-urban/rural
- Women's Savings Account: ₹10,000 with special benefits
- Senior Citizens Account: Same rate with additional privileges
- Salary Account: Zero minimum balance requirement
IOB and Other Public Sector Bank Rates
Indian Overseas Bank and other public sector banks offer competitive rates:
Indian Overseas Bank (IOB)
- Interest Rate: 2.75% - 3.00% p.a. depending on balance
- Minimum Balance: ₹5,000 (urban), ₹3,000 (semi-urban), ₹2,000 (rural)
- Compounding: Quarterly
Other Public Sector Banks
- Punjab National Bank (PNB): 2.70% p.a.
- Bank of Baroda: 2.75% - 3.35% p.a. (tiered rates)
- Canara Bank: 2.90% - 3.55% p.a.
- Union Bank of India: 3.00% - 6.20% p.a. (balance-based)
- Bank of India: 2.75% p.a.
Post Office Savings Account Interest Rate
India Post Office savings accounts remain popular due to government backing and competitive rates:
Post Office Savings Account Features
- Interest Rate: 4.00% p.a. (higher than most banks)
- Minimum Balance: ₹500 (very accessible)
- Maximum Balance: No upper limit
- Compounding: Annual (once per year)
- Tax Benefit: Interest up to ₹3,500 (individual) or ₹7,000 (joint) exempt under Section 80TTA
- Safety: Government-backed, risk-free investment
Why Post Office Rates Are Higher: Post Office savings accounts typically offer 0.5-1.5% higher interest than commercial banks because they're government schemes designed to encourage small savings. The trade-off is less frequent compounding (annual vs. quarterly) and fewer digital banking features compared to modern banks.
Factors Affecting Savings Account Interest
Multiple factors influence the interest rate you earn on savings deposits:
Reserve Bank of India (RBI) Policy
The RBI's repo rate directly impacts savings rates. When RBI increases repo rate to control inflation, banks typically raise savings rates. Conversely, rate cuts lead to lower savings returns. Current monetary policy significantly affects your earnings.
Bank Competition
Private banks and small finance banks often offer higher rates (3.5-7%) to attract deposits and compete with established players. Public sector banks generally offer more conservative rates but greater stability.
Account Balance
Many banks offer tiered interest rates—higher balances earn higher rates. For example, balances below ₹1 lakh might earn 2.5%, while balances above ₹10 lakh could earn 3.5% or more.
Account Type
Different account variants offer different rates. Salary accounts may have zero balance requirements but standard rates, while premium accounts might offer higher rates with higher minimum balances.
Maximizing Savings Account Interest
Strategic approaches to earn maximum interest on savings:
Compare and Choose Wisely
- Rate Shopping: Compare rates across banks—differences of 1-2% compound significantly over time
- Small Finance Banks: Consider banks like IDFC First, Yes Bank, or RBL Bank offering 4-7% rates
- Digital Banks: Neo-banks and digital-first banks often offer higher rates with lower overhead costs
Maintain Higher Balances
- Tiered Rates: If your bank offers balance-based rates, maintain balances that qualify for higher tiers
- Sweep-In Facilities: Use auto-sweep or flexi-deposit features that automatically move excess funds to higher-earning fixed deposits
Strategic Account Management
- Multiple Accounts: Maintain accounts in 2-3 banks—one for transactions, others for maximizing interest
- Timing: Deposit large amounts early in the quarter to maximize daily balance calculations
- Avoid Minimum Balance Penalties: Penalties often exceed 3-6 months of interest—maintain required minimums
Tax Implications on Savings Account Interest
Understanding tax treatment helps calculate actual post-tax returns:
Tax Deduction at Source (TDS)
- TDS Threshold: Banks deduct 10% TDS if interest exceeds ₹40,000 per year (₹50,000 for senior citizens)
- Form 15G/15H: Submit these forms if total income is below taxable limit to avoid TDS
- PAN Requirement: If PAN not linked, TDS is 20%
Income Tax Treatment
- Taxable Income: All savings interest is fully taxable under "Income from Other Sources"
- Section 80TTA: Interest up to ₹10,000 per year is deductible (for non-senior citizens)
- Section 80TTB: Senior citizens get ₹50,000 exemption
- Tax Slab: Interest taxed according to your income tax slab rate
Tax Example: If you earn ₹20,000 interest and are in 30% tax bracket:
Taxable Interest = ₹20,000 - ₹10,000 (80TTA) = ₹10,000
Tax Payable = ₹10,000 × 30% = ₹3,000
Net Interest = ₹20,000 - ₹3,000 = ₹17,000
Effective Rate (if principal ₹5 lakh at 4%) = 3.4% after tax
Frequently Asked Questions
Savings vs. Fixed Deposits: Interest Comparison
Understanding when to choose savings accounts versus fixed deposits:
Savings Account Advantages
- Liquidity: Withdraw anytime without penalty
- No Lock-In: Flexibility to use funds when needed
- Transaction Facility: Can make payments, transfers, and purchases
- Emergency Access: Ideal for emergency funds
Fixed Deposit Advantages
- Higher Rates: FDs offer 1-3% higher interest (5-7% vs. 2.5-4% for savings)
- Guaranteed Returns: Fixed returns regardless of rate changes
- Disciplined Saving: Lock-in prevents impulsive spending
- Senior Citizen Benefits: Additional 0.5% interest for seniors
Optimal Strategy
Maintain 3-6 months' expenses in high-interest savings for liquidity and emergencies. Park surplus funds exceeding emergency needs in fixed deposits for higher returns. Use laddering strategy—multiple FDs with staggered maturity dates—to balance liquidity and returns.