# AU SFB vs Equitas: Which Savings Account Pays You More?

You have ₹8 lakh sitting in your savings account. You are not going to touch it for two years. Both AU Small Finance Bank and Equitas Small Finance Bank call themselves high-interest accounts. So which one should it go to? Here is the honest answer: **on current rate cards, Equitas pays more at every balance between ₹1 lakh and ₹25 lakh — and above ₹10 lakh the difference is a flat ₹30,000 a year.** There is no balance point where AU overtakes. This article walks through exactly how much you give up by picking AU, and the one balance where that gap hurts most.

*All rates are as of October 2026 ("w.e.f." in the tables below means *with effect from*). Savings rates are variable and set by each bank — always check the bank's live rate card before you move money.*

## First, the rate cards — because the headline number lies

Both banks advertise a headline rate. Both headlines need a footnote. One word before the tables: a *slab* is just a band of balance with its own rate, and interest is worked out band by band rather than on your whole balance at the top rate.

AU Small Finance Bank pays **6.50% from ₹10 lakh upward** for a retail customer. Its next tier, 6.75%, only starts at ₹25 crore. The 7.00% tier runs from ₹100 crore but is *capped* — it stops at ₹750 crore, above which the rate drops to 4.00%. None of that is reachable by anyone reading this article.

Equitas Small Finance Bank pays its best-in-market **7.00% only between ₹1 lakh and ₹5 lakh**. Above ₹5 lakh it *falls* to 6.00%.

That fall is the single most surprising fact in this comparison. At ₹8 lakh in your account, Equitas pays you 6.00% — which is *less* than the 6.50% that AU pays above ₹10 lakh. Equitas's own marketing says "up to 7%". Up to, yes. Only up to — and the same page's feature list quietly spells out the actual slab.

### AU Small Finance Bank — savings slabs (w.e.f. 1 October 2026)

| Balance slab | Rate p.a. |
|---|---|
| Below ₹1 lakh | 2.50% |
| ₹1 lakh – ₹3 lakh | 2.50% |
| ₹3 lakh – ₹5 lakh | 2.75% |
| ₹5 lakh – ₹10 lakh | 3.50% |
| ₹10 lakh – ₹25 crore | 6.50% |
| ₹25 crore – ₹100 crore | 6.75% |
| ₹100 crore – ₹750 crore | 7.00% |
| ₹750 crore and above | 4.00% |

Calculated on a daily balance and credited monthly. [Check AU's live savings rate card](https://www.au.bank.in/interest-rates/savings-account-interest-rates).

**How the top slabs actually work — worth knowing before you read a number off that table.** Between ₹100 crore and ₹750 crore, the 7.00% applies to your *whole* balance — the same 7.00% on every rupee you hold above ₹1 lakh, not just on the part sitting inside that one row. That is what "flat" means here. Above ₹750 crore, the 4.00% applies to the balance above ₹750 crore. Below ₹1 lakh it works the other way: each rate applies only to the money inside its own row, so every extra rupee earns its own row's rate. For balances under ₹1 crore — which is every retail reader — none of this changes your rate.

### Equitas Small Finance Bank — savings slabs (w.e.f. 5 August 2026)

| Daily closing balance slab | Rate p.a. |
|---|---|
| Up to ₹1 lakh | 2.50% |
| Above ₹1 lakh – ₹5 lakh | 7.00% |
| Above ₹5 lakh – ₹10 lakh | 6.00% |
| Above ₹10 lakh – ₹25 crore | 6.50% |
| Above ₹25 crore | 7.00% |

Calculated on the daily closing balance and credited quarterly (31 March, 30 June, 30 September, 31 December). [Check Equitas's live rate card](https://equitas.bank.in/strapi-dev/uploads/Overall_Interest_Rates_1_e204130126.pdf).

## What each balance actually earns — the yield table

Here is where the money is. The table below applies each bank's bands to a constant daily balance, rupee for rupee. Interest is worked out band by band rather than on the whole balance at the top rate — that is how both banks calculate, and it is why the "up to" number is never what you actually get.

| Your balance | AU earns | AU effective rate | Equitas earns | Equitas effective rate | You give up with AU |
|---|---|---|---|---|---|
| ₹2 lakh | ₹5,000 | 2.50% | ₹9,500 | 4.75% | ₹4,500 |
| ₹5 lakh | ₹13,000 | 2.60% | ₹30,500 | 6.10% | ₹17,500 |
| ₹8 lakh | ₹23,500 | 2.94% | ₹48,500 | 6.06% | ₹25,000 |
| ₹10 lakh | ₹30,500 | 3.05% | ₹60,500 | 6.05% | ₹30,000 |
| ₹15 lakh | ₹63,000 | 4.20% | ₹93,000 | 6.20% | ₹30,000 |
| ₹25 lakh | ₹1,28,000 | 5.12% | ₹1,58,000 | 6.32% | ₹30,000 |

*Rates as of October 2026. Your actual interest will differ — these assume a constant daily balance for a full year. Check each bank's live rate card.*

### Two things to read off that table

**One. Equitas leads at every single point.** There is no crossover. If you were hoping to find the balance where AU wins, it does not exist between ₹1 lakh and ₹25 lakh on current slabs. At ₹10 lakh, Equitas pays ₹60,500 and AU pays ₹30,500 — double, not a flip.

**Two. The gap stops widening.** Above ₹10 lakh, both banks pay 6.50% on the top slab, so the difference freezes at **₹30,000 a year**. Whether you hold ₹10 lakh or ₹25 lakh, choosing AU costs you the same ₹30,000. That is the honest headline of this whole comparison.

### Where the gap bites hardest

The ₹30,000 plateau is the headline number. But measured against your balance rather than in rupees, the worst moment is **₹5 lakh, where the gap is 3.50% of everything you have parked**. ₹5 lakh is exactly where Equitas's best slab (7.00%) ends and AU is still in its weakest stretch (3.50%).

Above ₹5 lakh the percentage pain shrinks — 3.13% at ₹8 lakh, 3.00% at ₹10 lakh, 1.20% at ₹25 lakh — because AU's top slab catches up. So if you are choosing in rupees, anything above ₹10 lakh costs you the same ₹30,000. If you are choosing by proportion, ₹5 lakh is where the gap takes the biggest bite.

### The DICGC overlay — and why this is a yield decision, not a safety one

Read the yield table with one fact sitting next to it: DICGC insures up to **₹5 lakh of principal plus accrued interest, per bank**.

- **Below ₹5 lakh:** your money is 100% insured at *both* banks. The choice is close to meaningless for safety purposes — it is purely about the extra yield.
- **Above ₹5 lakh:** the limit is fully consumed at either bank. Everything past ₹5 lakh is uninsured at both. You are not choosing the safer bank. You are choosing whose balance sheet to bet the uncovered excess on.

That cover applies to bank deposits only. It does **not** extend to mutual funds, stocks, bonds or insurance.

Deposits at different branches of the *same* bank are added together for DICGC purposes. For the full mechanics — what counts, what does not, what happens on a claim — read [how DICGC's ₹5 lakh cover actually works](https://thewealthblog.in/dicgc-deposit-insurance-5-lakh-limit/).

If you would rather not bet the excess on one bank at all, [spreading your emergency fund across 2–3 banks](https://thewealthblog.in/small-finance-bank-safe-spread-emergency-fund/) keeps more of it inside the insured limit. That is a different strategy and it is covered separately.

## Minimum balance: the ₹2,000 claim is wrong

Most write-ups say "AU's minimum balance is ₹2,000". That is one variant out of many. AU's own rate document lists the minimum balance per variant:

| AU account variant | Minimum balance requirement |
|---|---|
| Kids, Student, Digital, Basic Savings Bank Deposit, Institution, Government Banking, AU Lite | Nil |
| Vikaas | ₹1,000 AMB |
| Kisan | ₹2,000 AQB |
| Swadesh | ₹5,000 AMB |
| Women, Senior Citizen, Value | ₹10,000 AMB (₹5,000 semi-urban / rural) |
| Platinum | ₹25,000 AMB |
| Royale | ₹1,00,000 AMB |
| Eternity | ₹10,00,000 AMB |
| IVY | ₹25,00,000 AQB |

*AMB = Average Monthly Balance, AQB = Average Quarterly Balance. Source: AU Rates-at-a-Glance, effective 23 April 2026.*

So the real range at AU is Nil to ₹10 lakh, depending on variant. The ₹2,000 figure belongs to the Kisan Savings variant alone.

What AMB and AQB actually ask of you: most variants want your balance averaged across the month, so ₹8 lakh sitting untouched all month is ₹8 lakh's worth of average. Two variants average across the quarter instead. Neither is a rule that says you must be above the number on every single day.

Equitas Regular Savings carries an average monthly balance of ₹10,000 in metro and urban areas, ₹5,000 in semi-urban areas and ₹2,500 in rural areas. The important part is what happens if you fall below it: nothing. Equitas states plainly on its own savings page, *"Importantly, no penalty is charged for non-maintenance of AMB."* Equitas also offers fully digital Selfe and Digital Savings variants.

## Credit ratings: AA versus AA−, one full notch apart

Both banks carry strong ratings. They are not the same rating, and rounding both to "AA" would be misleading. One more wrinkle before the table: they are graded at different levels. AU's grades are attached to a specific piece of borrowing — its subordinated debt and Tier II bonds. Equitas's headline grade is for the bank as a whole. An instrument grade and an issuer grade are not measured on quite the same basis, so read them side by side rather than as a straight league table.

| Bank | Basis | Rating | As of |
|---|---|---|---|
| AU Small Finance Bank | Long-term / subordinated debt / Tier II bonds (instrument-level) | CRISIL AA/Stable · CARE AA/Stable · ICRA AA/Stable | ICRA Tier II action dated 26 February 2026, per AU's SEBI LODR intimation of that date (Ref. AUSFB/SEC/2025-26/455). CARE and CRISIL grades as published on AU's credit-rating page. |
| Equitas Small Finance Bank | Issuer rating | CARE AA−/Stable · IND AA−/Stable | Reaffirmed 8 September 2026 by both CARE Ratings and India Ratings. |

AA− is one notch below AA. If you are parking uninsured money above the DICGC limit, that notch is worth knowing about.

Equitas also carries honest caveats worth reading, from the rating agency's own rationale: its credit-to-deposit ratio is high, and Tamil Nadu accounts for 44% of gross advances as of 30 June 2026. Asset quality is described as moderate but improving. These are disclosed facts about a bank's lending book, not predictions.

## The thing nobody tells you: how often these rates change

If you are choosing a savings account as a park-it-and-forget home, the stability of the rate matters as much as its height. Here the two banks behave very differently.

|  | AU SFB | Equitas SFB |
|---|---|---|
| Retail slab changes in 2026 | 1 (23 April) | At least twice (26 February, 5 August) |
| Interest credited | Monthly | Quarterly |

Equitas has repriced its savings slabs at least twice this year — the 26 February card carried materially different slabs from the one now in force. AU's retail slabs have been broadly stable since 23 April 2026.

This is not a criticism of Equitas — changing rates in a falling-rate environment is normal banking. But if you are moving ₹15 lakh and planning to leave it, a bank that has moved its slabs more than once in eight months is a different proposition from one that has not. Check the live rate card on the day you transfer.

On crediting frequency, AU pays monthly and Equitas quarterly. The compounding difference is small — fractions of a percent over a year — but it is real, and it is one of the few places AU is ahead.

## Why small finance banks pay more than big banks

Small finance banks lend to priority sectors and to borrowers that larger banks often skip — small ticket loans, microfinance, agriculture, self-help groups. Those loans carry higher yields, which means a small finance bank can afford to bid more for deposits than a large bank can. Their low-cost current account base is thin, so there is less "free" funding to lean on. That deposit competition, concentrated in a handful of banks, is what pushes retail savings rates up.

One caveat, stated honestly: this is the structural explanation drawn from the banks' own annual reports and the RBI's June 2026 Financial Stability Report. The RBI does not publish a per-bank finding of the form "SFBs pay more because…". Treat the mechanism as the well-known reason, not as a regulatory conclusion.

## Which one makes sense in which situation

No personalised advice here — just the situations, and what each choice looks like from inside them.

- **Balance under ₹5 lakh.** Both banks are 100% DICGC-insured. The decision is the extra yield alone, and on current slabs that yield is meaningfully higher at Equitas. The "no maintenance penalty" position at Equitas also suits a low-balance, set-and-forget approach.
- **Balance of ₹5 lakh to ₹10 lakh.** The hardest band proportionally — Equitas pays 7.00% up to ₹5 lakh then 6.00%, while AU sits at 3.50%. Above ₹5 lakh, DICGC protection is fully used up at either bank, so this is a pure yield-and-credit-quality call.
- **Balance above ₹10 lakh.** The gap is a flat ₹30,000 a year at every balance. A larger balance does not improve AU's position — it only makes the ₹30,000 a smaller share of the total.
- **Anyone who needs the money within weeks.** Neither bank's top slab is meant for that. An emergency fund that must be reachable the same month belongs somewhere it can be withdrawn without giving up the headline rate.
- **Anyone who will leave the balance parked for years.** Rate churn becomes the deciding factor. Equitas's 2026 repricings are worth weighing against the extra yield.

## Tax treatment on savings interest

Savings account interest is fully taxable at your income-tax slab rate in India. There is no deduction at source on it. Under the old tax regime, resident senior citizens can claim a deduction on interest income — the current limits and the differences between the provisions are covered in our guide to [80TTA vs 80TTB compared](https://thewealthblog.in/80tta-vs-80ttb/).

## Key takeaways

- **Equitas pays more at every balance from ₹1 lakh to ₹25 lakh.** There is no crossover point.
- **Above ₹10 lakh the gap is a flat ₹30,000 a year.** Both banks pay 6.50% on the top slab, so the difference never widens again.
- **₹5 lakh is where the gap bites hardest proportionally** — 3.50% of your balance — because that is exactly where Equitas's 7.00% slab ends.
- **Equitas's 7.00% is a ₹1–5 lakh fact**, and it falls to 6.00% above ₹5 lakh — below the 6.50% AU pays above ₹10 lakh.
- **AU's real retail headline is 6.50%.** The 6.75% tier needs a ₹25 crore balance, the 7.00% tier runs only to ₹750 crore, and above that the rate drops to 4.00%.
- **AU's minimum balance is variant-specific**, from Nil to ₹10 lakh. The "₹2,000" figure is the Kisan variant only.
- **Ratings are a full notch apart** — AU's Tier II bonds at AA, Equitas's issuer rating at AA−, both Stable.
- **Rate churn matters for a park-it-and-forget choice:** Equitas repriced at least twice in 2026, AU once.
- **Below ₹5 lakh you are choosing yield; above it you are choosing a balance sheet.** DICGC's limit is the same at both banks, and it does not cover mutual funds, stocks, bonds or insurance.

## Frequently Asked Questions

### Which bank pays more at my exact balance?

Equitas, at every balance point checked between ₹1 lakh and ₹25 lakh. At ₹2 lakh it earns ₹9,500 against AU's ₹5,000. At ₹10 lakh, ₹60,500 against ₹30,500. See the yield table above for the full six-point comparison.

### Is there any balance at which AU beats Equitas?

Not between ₹1 lakh and ₹25 lakh on the current rate cards. Both banks pay 6.50% above ₹10 lakh, and Equitas has already earned more on every slab beneath it.

### Is Equitas really 7%?

Only on the ₹1–5 lakh slab. Above ₹5 lakh it falls to 6.00%, which is lower than the 6.50% both banks pay above ₹10 lakh. The "up to 7%" figure describes the best slab, not the account.

### What is AU's real headline rate?

6.50% from ₹10 lakh. The 6.75% tier requires a ₹25–100 crore balance, the 7.00% tier runs only from ₹100 crore to less than ₹750 crore, and balances of ₹750 crore and above pay 4.00% — none of which are reachable by a retail saver.

### AU's minimum balance is ₹2,000 — is that right?

That is the Kisan Savings variant only. Other AU variants run from Nil (Kids, Student, Digital, AU Lite and others) up to ₹10 lakh average monthly balance. The full variant table is in this article.

### Does Equitas have a genuinely zero-balance account?

No penalty, confirmed in the bank's own words: "Importantly, no penalty is charged for non-maintenance of AMB." Equitas Regular Savings carries an average monthly balance requirement of ₹10,000 in metro and urban areas, ₹5,000 semi-urban and ₹2,500 rural, and fully digital Selfe and Digital Savings variants also exist. Whether one of those carries a literal nil minimum balance in writing is unconfirmed — check the bank's Schedule of Charges.

### Do these rates change often?

Equitas has revised its savings slabs at least twice in 2026 — on 26 February and 5 August. AU's retail slabs have been broadly stable since 23 April. Confirm the live rate card before parking a large balance.

### Is interest credited monthly or quarterly?

AU credits monthly; Equitas credits quarterly, on 31 March, 30 June, 30 September and 31 December. The compounding difference is small but it is one of the few areas where AU is ahead. It is also part of the wider case for [spreading your emergency fund across 2–3 banks](https://thewealthblog.in/small-finance-bank-safe-spread-emergency-fund/) rather than concentrating it.

### Is one bank better rated?

AU's long-term, subordinated debt and Tier II bonds are rated AA/Stable by CRISIL, CARE and ICRA — instrument-level ratings, with the ICRA Tier II action dated 26 February 2026. Equitas's issuer rating is AA− Stable (CARE and India Ratings), reaffirmed 8 September 2026. AA− is one full notch below AA. The rating agencies also flag Equitas's high credit-to-deposit ratio and Tamil Nadu at 44% of gross advances as of 30 June 2026.

## Sources

**Rate cards**

- AU savings account interest rates, w.e.f. 1 October 2026 — [au.bank.in](https://www.au.bank.in/interest-rates/savings-account-interest-rates)
- AU Rates-at-a-Glance, w.e.f. 23 April 2026 (variant minimum balances, fees) — [au.bank.in](https://www.au.bank.in/notice-board/notice-board-folder-10/rates-at-a-glance.pdf)
- Equitas overall interest rates, savings slabs w.e.f. 5 August 2026 — [equitas.bank.in](https://equitas.bank.in/strapi-dev/uploads/Overall_Interest_Rates_1_e204130126.pdf)
- Equitas overall interest rates, savings slabs w.e.f. 26 February 2026 (superseded) — [equitas.bank.in](https://equitas.bank.in/strapi-dev/uploads/Overall_Interest_Rates_1_70458966af.pdf)
- Equitas basis of interest calculation (RBI daily-product circular, quarterly crediting) — [equitas.bank.in](https://equitas.bank.in/strapi-dev/uploads/Basis_of_Interest_Calculation_72073be6da.pdf)
- Equitas Regular Savings (AMB tiers, no-penalty statement) — [equitas.bank.in](https://equitas.bank.in/personal-banking/save/savings-account/regular-savings/)
- Equitas Schedule of Charges — [equitas.bank.in](https://equitas.bank.in/schedule-of-charges/)

**Ratings**

- AU Small Finance Bank credit ratings page (CRISIL, CARE, ICRA on long-term / subordinated debt / Tier II bonds) — [au.bank.in](https://www.au.bank.in/credit-rating)
- AU SEBI LODR intimation of ICRA's Tier II rating action, Ref. AUSFB/SEC/2025-26/455, dated 26 February 2026 (with ICRA's rating rationale annexed) — [au.bank.in](https://www.au.bank.in/pdfs/stock-exchange-disclosure/eca/2025-26/20260226_Credit-Rating-Intimation.pdf)
- CARE Ratings, Equitas Small Finance Bank, 8 September 2026 — [careratings.com](https://www.careratings.com/upload/CompanyFiles/PR/202609140930_Equitas_Small_Finance_Bank_Limited.pdf)
- India Ratings, Equitas issuer and instrument ratings (8 September 2026 reaffirmation) — [indiaratings.co.in](https://www.indiaratings.co.in/search/issuerid/480)
- Equitas Small Finance Bank Annual Report 2025-26 — [ir.equitas.bank.in](https://ir.equitas.bank.in/wp-content/uploads/2026/08/Annual-Report-2025-26.pdf)

**Insurance, macro and tax**

- DICGC official FAQ (₹5 lakh principal plus interest, per bank, aggregated across branches) — [dicgc.org.in](https://www.dicgc.org.in/FAQs)
- RBI Financial Stability Report, June 2026 press release — [rbi.org.in](https://m.rbi.org.in/Scripts/BS_PressReleaseDisplay.aspx?prid=63050)
- Income Tax Department FAQ index — [incometaxindia.gov.in](https://incometaxindia.gov.in/Pages/faqs.aspx)

## One action to take today

Open your bank's live savings rate card and find the slab your current balance actually falls into — not the headline, the slab. Then ask yourself one question: is the balance sitting above ₹5 lakh? If it is, you are already past the DICGC line, and the bank choice is a pure yield decision. At current rates that decision is worth about ₹30,000 a year above ₹10 lakh.

For the wider picture — how account types, minimum balances and insurance fit into an overall banking setup — see our guide to the [best banking accounts in India](https://thewealthblog.in/best-bank-accounts/).

*Disclaimer: This article is for informational and educational purposes only and is not financial advice, a recommendation, or an offer. Savings interest rates are variable, set at the discretion of each bank, and change without notice — always verify against the bank's live rate card before acting. Deposit insurance coverage is governed by DICGC rules and is subject to change. Do not rely on this article as a substitute for your own research or for advice from a qualified financial professional. Some links on this page may be affiliate links, which do not affect the prices or rates described here.*