Should you invest your savings in a Post Office FD or an SBI FD? This question is in every investor’s mind. Both are safe investment options, but do you know where you get more interest and where your money doubles the fastest? Let’s know about the FD interest rate of both in this detailed comparison and understand which scheme is more beneficial for you.

Interest rates on SBI fixed deposits

India’s largest public sector bank, State Bank of India (SBI), offers interest on fixed deposits based on the deposit period. It is a reliable option, but its interest rates keep changing frequently. Here are some of the prevailing interest rates of SBI for tenures ranging from 1 to 5 years.

SBI FD
SBI FD
  • The interest rate on FDs of less than one year and up to two years is 6.25%.
  • The interest rate on FDs of less than two years and up to three years is 6.45%.
  • The interest rate on FDs of less than three years and up to five years is 6.30%.

Post Office Time Deposit offers a higher interest rate

Fixed deposits are known as ‘Time Deposit’ (TD) in the post office. The interest rates offered in post office time deposits are usually higher than those offered by SBI, making it a better option for investors. Here is the information about the interest offered in the post office for different periods:

  • The interest rate on 1 1-year time deposit is 6.9%.
  • The interest rate on 2 2-year time deposit is 7.0%.
  • The interest rate on 3 3-year time deposit is 7.1%.
  • The interest rate on 5 5-year time deposit is 7.5%.

Where will your money double the fastest?

If you want to know where your money will double in a fixed deposit, then the ‘Rule of 72’ is used for this. According to this rule, you have to divide 72 by the interest rate, which tells you how much time it will take for your money to double.

Since the post office is offering an FD interest rate of 7.50% for 5 years, dividing 72 by 7.50 gives approximately 9.6. This means that your money will double in about 9.5 years in the 5-year time deposit scheme of the post office. On the other hand, at SBI’s best rate of 6.45%, it will take more than 11 years for the money to double. It is clear that the post office time deposit not only gives a higher interest rate of 7.5% than the banks, but your money also grows faster here.