₹35 Lakh Fixed Deposit Interest Per Month in 2026

Do you know that you can earn around ₹20,000 as ₹35 lakh fixed deposit interest per month in 2026? This can help you earn a regular interest income to manage your monthly expenses.

However, while booking your fixed deposit, you need to select the monthly interest payout option. If you are planning to book a monthly interest payout fixed deposit, check out the interest rate offered by different banks, the TDS and penalty on premature withdrawal to make an informed decision.

₹35 Lakh Fixed Deposit Interest Per Month at Different Rates

The interest rate on a ₹35 lakh fixed deposit varies between different financial institutions and is based on the tenure. Here is the interest rate from banks offering monthly interest payouts:

Notably, not all banks offer the monthly interest payout option on fixed deposits. You can check out the Stable Money app to select banks offering the option to manage your monthly expenses.

TDS on ₹35 Lakh Fixed Deposit Interest

Banks deduct Tax Deducted at Source (TDS) if the total fixed deposit interest for a non-senior citizen exceeds ₹50,000 in a financial year. On the flip side, if senior citizens have a fixed deposit interest of more than ₹1 lakh in a financial year, the bank would deduct TDS.

The rate of TDS deduction is 10% if the depositor submits PAN card details. In case the PAN card details are not submitted, the bank would deduct a 20% TDS. 

However, if you want to avoid TDS deduction, you can submit Form 15G (non-senior citizens) or Form 15H (senior citizens) to the bank at the beginning of the financial year.

Penalty on Premature Withdrawal of ₹35 Lakh Fixed Deposit

Banks and Non-banking Financial Institutions (NBFCs) usually allow premature liquidation of fixed deposits in case of the depositor's financial emergencies. Notably, you can consider premature withdrawal if your fixed deposit (FD) does not have a lock-in period.

However, banks charge a premature withdrawal penalty on the effective interest rate. Consider the following example to understand how premature FD liquidation works.

Suppose Mr X has a fixed deposit of ₹35 lakh for 3 years at 7.5%, compounding yearly. After 1 year, he wishes to liquidate his fixed deposit prematurely. The applicable penalty is 1%. Here is the calculation of the actual interest rate:

If you want to book DICGC-insured ₹35 lakh fixed deposits and earn monthly interest, download the Stable Money app now!