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Which bank offers higher returns on a ₹50 lakh FD over 5 years? A detailed breakdown of 7 banks, including SBI, HDFC, and ICICI..

Shikha Saxena | August 20, 2026 2:15 PM CST

If you have a substantial sum of ₹50 lakh and wish to invest it for five years with minimal risk, a bank Fixed Deposit (FD) could be a good option. However, the question remains: which bank offers the highest return on a ₹50 lakh deposit over five years?

Among major banks, interest rates for general customers on a 5-year FD typically range between 6% and 6.50%. Meanwhile, many banks offer additional interest rates to senior citizens.

How much will a ₹50 lakh FD yield across different banks?
In a 5-year cumulative FD, the interest earned is reinvested into the deposit, allowing it to earn further interest. Due to this compounding effect, the final amount after five years is higher than what simple interest would yield.

Which offers the best return?
Among the banks compared, ICICI Bank offers the highest rate for general customers at 6.50%. A ₹50 lakh FD grows to approximately ₹69 lakh, resulting in interest earnings of around ₹19 lakh. This is followed by Axis Bank (approx. ₹68.8 lakh) and Kotak Mahindra Bank (approx. ₹68.2 lakh).

Understanding the calculation
Let’s assume ₹50,00,000 is invested in a cumulative FD for five years at an annual interest rate of 6.50%. If interest is calculated based on quarterly compounding, the formula is:

Maturity Amount = P × (1 + R/4)^(4×T)

Where:

* P = ₹50,00,000
* R = 6.50%
* T = 5 years
* Compounding = 4 times a year

Based on this calculation, the total amount comes to approximately ₹69.02 lakh, with the interest component being around ₹19.02 lakh.

In other words, a principal amount of ₹50 lakh could grow by about ₹19 lakh over 5 years; however, the actual maturity amount may vary slightly depending on the bank's specific rules, compounding frequency, and the type of FD. Bank FD calculators also compute maturity values based on the interest rate, tenure, and compounding method.

Consider the tax implications as well.
Interest earned on an FD is not entirely tax-free. It is added to your taxable income and may be subject to tax according to your applicable income-tax slab. Therefore, the ₹19 lakh interest figure shown by a bank's calculator does not necessarily represent the net amount you will receive in hand.

Disclaimer: This content has been sourced and edited from Dainik Jagran. While we have made modifications for clarity and presentation, the original content belongs to its respective authors and website. We do not claim ownership of the content.