List of Bank Bonds in India 2026

Name: Bank Bonds
Brand: Bonds
Rating: 4.9 (8180 reviews)

Bank bonds are debt instruments issued by banks to raise funds from investors while offering fixed and predictable returns over a defined tenure. Regulated by the Reserve Bank of India (RBI) and SEBI, these bonds are commonly considered a relatively stable option within the fixed-income segment. They can help investors diversify their portfolios, generate regular interest income, and reduce exposure to market volatility. Continue reading to learn how bank bonds work, their key features, risk, taxation, etc.

What are Bank Bonds?

Bank bonds are a type of debt security that is issued by banks or other financial institutions. These bonds are used to raise funds by banks. They are regulated by the RBI and SEBI. Investing in these bonds is beneficial as it brings diversification in the portfolio.

Key Features & Benefits of Bank Bonds

Here are some of the key features and benefits of Bank Bonds-

Safety:

Bank bonds are considered secure as regulated by the Reserve Bank of India and SEBI. RBI ensures that banks are highly regulated and secure which makes these bonds the safest option. The government of India holds a majority of shares in PSU banks which enables stability at the time of crises.

Higher Returns

Bank Bonds offer higher returns to investors and retired investors prefer this bond in order to ensure a fixed income source in the long term.

Portfolio diversification

Adding bank bonds to your investment mix helps diversify your portfolio. They typically carry lower risk compared to equities, mutual funds, or real estate, making them suitable for investors looking to balance risk while maintaining steady returns.

Low reinvestment hassle

Bank bonds generally reduce reinvestment risk. Investors can lock in returns for a fixed tenure without the need to frequently search for alternative investment options when interest rates fluctuate.

Liquidity without penalties

Unlike fixed deposits, which may impose penalties on premature withdrawal, listed bank bonds can be sold in the secondary market anytime. This gives investors flexibility and access to funds without incurring withdrawal charges.

List of Bank Bonds in India

COMPANY	ISIN	NAME OF THE INSTRUMENT	COUPON RATE	CREDIT RATING
NATIONAL HOUSING BANK	INE557F07090	8.63% TAX FREE BONDS IN THE NATURE OF SECURED REDEEMABLE NON-CONVERTIBLE DEBENTURES . TRANCHE -I SERIES 2A. LETTER OF ALLOTMENT. DATE OF MATURITY 13/01/2029	8.63%	AAA ICRA LIMITED DT 10-12-2013
NATIONAL BANK FOR AGRICULTURE AND RURAL DEVELOPMENT	INE261F08CH5	6.79% UNSECURED RATED LISTED REDEEMABLE NON CONVERTIBLE TAXABLE BOND. NCD Series LTIF 5B. LETTER OF ALLOTMENT.DATE OF MATURITY 25/06/2035	6.79%	AAA ICRA LIMITED DT 23-06-2020
CANARA BANK	INE476A08076	7.18% UNSECURED SUBORDINATED NON CONVERTIBLE REDEEMABLE FULLY PAID UP TAXABLE BASEL III COMPLIANT TIER II BONDS IN THE NATURE OF DEBENTURES. LETTER OF ALLOTMENT. SERIES I. DATE OF MATURITY 11/03/2030	7.18%	AAA CARE RATINGS LIMITED DT 29-02-2020
STATE BANK OF INDIA	INE062A08439	7.36% UNSECURED RATED LISTED REDEEMABLE NON-CONVERTIBLE BONDS IN THE NATURE OF DEBENTURE SERIES SBI 2024 LTB SERIES 2 DATE OF MATURITY 11/07/2039.	7.36	AAA CRISIL RATINGS LIMITED DT 05-07-2024
SMALL INDUSTRIES DEVELOPMENT BANK OF INDIA	INE556F08KN9	7.75% UNSECURED RATED LISTED REDEEMABLE NON CONVERTIBLE BOND SERIES VII DATE OF MATURITY 10/06/2027	7.75	AAA CRISIL RATINGS LIMITED DT 10-01-2024
BANK OF BARODA	INE028A08125	8.42% UNSECURED LISTED BASEL III TIER II NON CONVERTIBLE BONDS. SERIES XVIII. DATE OF MATURITY 07/12/2028	8.42%	AAA CARE RATINGS LIMITED DT 30-11-2018
SMALL INDUSTRIES DEVELOPMENT BANK OF INDIA	INE556F08KO7	7.68% UNSECURED RATED LISTED REDEEMABLE NON-CONVERTIBLE BONDS IN THE NATURE OF DEBENTURE SERIES VIII DATE OF MATURITY 09/07/2027.	7.68	AAA CRISIL RATINGS LIMITED DT 10-01-2024
IDFC FIRST BANK LIMITED	INE092T08CQ6	8.50% UNSECURED REDEEMABLE LONG TERM BONDS IN THE NATURE OF DEBENTURES. SERIES IDBKL BBPP 1/2017. DATE OF MATURITY 04/07/2023	8.50%	AAA INDIA RATING AND RESEARCH PVT. LTD DT 26-04-2016
AXIS BANK LIMITED	INE238A08369	8.45% UNSECURED REDEEMABLE NON CONVERTIBLE BASEL III COMPLIANT TIER 2 BONDS IN THE NATURE OF DEBENTURES. SERIES 22. DATE OF MATURITY 12/02/2025	8.45%	AAA CARE RATINGS LIMITED DT 23-01-2015
PUNJAB NATIONAL BANK	INE160A08324	7.34% UNSECURED RATED LISTED REDEEMABLE NON CONVERTIBLE BOND IN THE NATURE OF DEBENTURE SERIES III DATE OF MATURITY 14/02/2035	7.34	AAA INDIA RATING AND RESEARCH PVT. LTD DT 03-02-2025

Who Should Invest in Bank Bonds?

Bank bonds are best suited for investors who want predictable returns with relatively lower risk compared to equities. Here’s who should consider investing in them:

Conservative investors: People who prefer capital safety and steady interest income over high market-linked returns.

Fixed-income seekers: Investors looking for regular interest payouts (monthly, quarterly, or annual) to supplement income.

Retirees or near-retirement investors: Those who want stable, low-volatility investments to preserve wealth and generate income.

Investors diversifying their portfolio: Investors who want to diversify their portfolio can invest in Bank bonds by adding stability and fixed returns.

Risks Involved in Bank Bonds

Taxability: Bank bonds don't come with any tax benefit. TDS is deducted by the bank on any interest earned by an investor.
Interest Rate Risk: Banking institutions are exposed to interest rate risk as the rate at which the loans are given is fixed, whereas the rate at which it has raised money from depositors/investors is variable.
Inflation Risk: Bank bonds’ interest rates are fixed for the given tenure of deposit, they might fail to beat the inflation risk. For instance, the bank bond gives an investor a return of 6%, and the inflation rate is 7%. That means the investor is earning a negative return on his investment.

Tax Applicability on Bank Bonds

Taxation on bank bonds in India depends on the type of bond and how the returns are received. Here’s a simple breakdown:

Interest Income: Interest earned from bank bonds is fully taxable under “Income from Other Sources.” It is taxed as per your income tax slab rate. Banks may deduct TDS if interest exceeds the prescribed threshold.

Tax-free bank Bonds: Interest from tax-free bonds is exempt from tax.

Disclaimer

The Bank bond data on this page is sourced from the NSDL website and is based on publicly available market information as on 11 March 2026. Prices, yields, trade values, and other related details are subject to change in real time depending on market movements and liquidity. This content is intended solely for informational and educational purposes and should not be considered as investment advice, recommendation, or an offer to buy or sell any securities.