The financial institutions known as small finance banks are those engaged in providing credit facilities to small business units, micro and small industries, small and marginal farmers and other unorganised sectors. They operate under a Small Finance Bank licence obtained from the Reserve Bank of India.

Increasing access to financial services in rural and semi-urban areas is the primary goal of small financing institutions. These banks have essentially all the capabilities as that of typical commercial banks, just on a much smaller size. The main focus remains on tier three cities, small towns and rural areas. Small finance banks have the potential to offer an alternative to some of the existing big financial institutions. To lure depositors, small finance banks are offering a high interest of as high as 9% on fixed deposits (FDs). Here are some top small finance banks you can invest in:

Suryoday Small Finance Bank

Suryoday Small Finance Bank is offering 8.51% interest for common people and 8.76% for senior citizens on a 999-day FD. The general public can borrow money from Suryoday Small Finance Bank at an interest rate of 4% to 6% for terms ranging from 7 days to 10 years. Senior citizens, on the other hand, can get interest rates ranging from 4.50% to 6.50% throughout the same time. In addition, the bank is selling FDs with terms of 2 years to 998 days to the general public at interest rates of 7.51% and 8.51%, and senior citizens at interest rates of 8.51% and 8.76% throughout the same period.

Unity Small Finance Bank

Three unique fixed-rate deposit (FD) programs have been launched by Unity Small Finance Bank, giving interest rates of 8.75% to the general public and 9.25% to senior citizens on FDs of 181-201 days. The bank offers interest rates of 8.75% and 9% for FDs with terms of 501 days and 1,001 days to regular individuals, and 9.25% and 9.5% respectively, for senior persons.

Jana Small Finance Bank

Senior citizens can get an interest rate of 8.80% while general customers can get 8.10% interest on FDs with a term of two to three years.

North East Small Finance Bank

Senior citizens can get 8.75% interest rates on 1,111-day FDs from North East Small Finance Bank, while other customers can get interest rates of 8%.

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