Fix a Future with Stable Returns!
Opt for a secured investment with a Fixed Deposit and get higher returns without risking your initial amount.
The fixed amount of money deposited in your account can be your long-term investment or the only source of income that you can rely upon in old age. A fixed deposit helps you to secure a long-term investment in the present. Fixed Deposit is a secured investment that is safe and reliable to grow your savings without going through a risk.
There is always a point or situation in our life where we wish to have savings or any Financial Backup. There are options like seeking help from your friends or relatives, but no one can guarantee they would help. To prepare for such conditions, the best option is to keep your backup ready with a – Fixed deposit.
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What is a Fixed Deposit?
Fixed Deposit is also known as FD or Term Deposit. This is a Financial Product offered by Banks, where a lump sum amount is credited to a savings account along with a predetermined period of time and interest rate. The interest rates offered on a Fixed Deposit Account are traditionally higher than the Regular Savings Accounts.
How Does a Fixed Deposit Work?
- Choose a Financial Institute and open an FD Account
- Deposit a Lump Sum amount in your FD Account
- Choose a Tenure based on your Financial Goals
- The bank will offer you a fixed interest rate
- Decide how you want to receive your Interest payouts
- Once you reach the completion of your tenure, your FD will be considered as matured
- Access your initial deposit and the interest earned during the entire tenure
Note: In some cases, the account holder could need to break the FD before its maturity, which is called premature withdrawal. In this case, the banks usually either charge any amount on it or reduce the interest rate.
Types of Fixed Deposit | |
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Types of FDs for NRIs | |
NRE Fixed Deposit | NRO Fixed Deposit |
Options after FD Maturity
You have a few options when your FD matures:
- Withdraw the entire maturity amount, including the principal and interest.
- Renew the FD for another term at the prevailing interest rate.
- Withdraw only the interest and allow the principal to roll over for another term.
Benefits of Fixed Deposit
- Capital Safety
- Fixed Interest Rates
- Higher Interest Rates than Regular Account
- Desired Tenure
- Guaranteed Returns
- Predictable earnings
- Premature Withdrawals in emergency
- Tax Benefits
- Nomination Facility
Generally Required Documents to Open a Fixed Deposit Account
- Proof of Identity (e.g., passport, driver’s license).
- Proof of Address (e.g., utility bills, bank statements).
- Passport-size photographs.
- PAN Card (in many countries).
- Nomination Form (if needed).
- Income Proof (if required).
- Application Form provided by the bank.
- Additional documents as specified by the bank.
Note: The required documents may vary based on your lender’s preference.
Eligibility to Open a Fixed Deposit Account
- Minimum age requirement, often 18 years or older.
- Individuals, joint account holders, or minors with a guardian.
- Resident or non-resident status, depending on the bank’s policies.
- Compliance with Know Your Customer (KYC) norms.
- Adequate funds to meet the minimum deposit requirement, which varies by bank.
- Meeting any specific eligibility criteria set by the bank, such as citizenship status or income level.
FAQs
A Fixed Deposit is a financial product offered by banks and financial institutions where you deposit a lump sum amount of money for a specific period at a fixed interest rate. The money is locked in for that duration, and you earn interest on it.
You deposit a specific amount of money into an FD account for a chosen tenure. The bank pays you interest on this amount at a predetermined interest rate. At the end of the tenure, you receive your principal amount along with the interest.
The minimum and maximum tenure for an FD can vary depending on the bank or financial institution, but typically, tenures range from 7 days to 10 years.
Yes, you can withdraw your money before the maturity date, but it might come with penalties and a lower interest rate. This is often called a premature withdrawal.
Interest rates on FDs can vary based on factors like the tenure and the bank’s policies. It’s essential to check the latest rates offered by the bank or financial institution.
