|CRISIL Rating||F AAA|
|Listed on exchange as||Kotak Mahindra Bank Ltd.|
|Tenure||Regular customers||Senior citizens|
This type of FD is offered by Kotak Mahindra and all the other banks to its customers in India. In a standard fixed deposit, an investor is required to invest his/her money for a fixed tenure, at a predetermined interest rate. Standard fixed deposit Korak Mahindra ranges from 7 days to 10 years. This is, by far, the most popular FD option chosen by investors.
These types of deposits are named Special Fixed Deposits as they are usually offered for a special time period. A special time period can range from any time such as 290 days or 390 days, etc. These types of FDs offer a higher interest rate and are a popular choice among various investors apart from standard deposits.
Tax saving fixed deposits, as the name sounds helps depositors to save tax under section 80C. Kotak Mahindra tax saving FD cannot be booked for less than a period of 5 years. The amount invested is exempt from tax under section 80C, but you should keep in mind that the interest generated from the FD is liable to be taxed.
Kotak Mahindra is one of the few banks in India which offers its investors with the option of a flexible interest rate. The rate of floating FDs change quarterly or yearly and the investors can avail the benefits of a changing interest rate. The change in the rate of interest is determined by RBI guidelines.
Kotak FD provides short-term deposits ranging from 7 days to 1 year. The interest rates for general customers are 2.50% to 4.50%, and 3.00% to 5.00% for senior citizens.
Medium-term deposits range from 1 year to 4 years and 11 months, and the interest rates for general customers are 4.50% to 5.20% and 5.00% to 5.70% for senior citizens.
Long-term deposits range from 5 years to 10 years. The interest rates for general customers are 5.25% and for senior citizens are 5.75%.
A Kotak Mahindra Bank FD account can be opened through different modes like Mobile App, Internet Banking, and offline.
1) Internet Banking
Follow the below-mentioned steps for opening a Kotak Mahindra Bank FD account via internet banking-
2) Mobile App - Kotak Bank App
Follow the steps mentioned ahead to open an FD account via Kotak Bank-
3) Opening Kotak Mahindra Bank FD Offline
For opening a Kotak Mahindra Bank FD account via offline mode, one has to visit the nearest Kotak Mahindra Bank branch. Fill out the Kotak Mahindra Bank FD application form and present all the necessary documents with the deposit amount. On successful processing of the application, an FD receipt will be provided by the Kotak Mahindra Bank.
Individuals or entities satisfying the following criteria can opt for a fixed deposit in Kotak Mahindra Bank FD –
The following documents have to be furnished for opening a Kotak Mahindra Bank FD–
An investment in Kotak Mahindra Bank Tax Saving FD entitles to tax saving up to Rs. 1,50,000 p.a. No other Kotak Mahindra Bank FD entitle to tax saving under Section 80C of the Income Tax Act.
Also, note that the interest income from the Kotak Mahindra Bank Fixed Deposit is taxable according to the slab rates of income tax. Also, the interest income is subject to a TDS of 10% if the income from Kotak Mahindra Bank FD exceeds Rs. 40,000 p.a.
For senior citizens, the limit is Rs. 50,000 p.a. Also, if the investor fails to provide PAN Card details to the bank, the TDS rate will be 20%.
Kotak Mahindra Bank provides loans against their Fixed Deposits. Investors can receive up to 85% of the deposit as a loan against Kotak Mahindra FD. The rate of interest for the loan will be between 3.5-6.3%.
Kotak Bank Fixed Deposits can be withdrawn prematurely, excluding the tax-saving Fixed Deposit. For all deposits under 181 days, if withdrawn prematurely, no penalty is levied. Note that all deposits having a tenure of more than 181 days will have a penalty of 0.5% interest rate.
Can I open an FD account in Kotak Mahindra in a joint account with a non-senior citizen?
Yes, provided the first account holder is a senior citizen.
What are the factors influencing Kotak Mahindra Bank FD rates?
Interest rates are the most critical part of fixed deposits, apart from the security it provides to depositors. These rates depend primarily on the following factors:
Age of the depositor – Individuals above the age of 60 years, i.e. senior citizens are eligible for a higher rate of interest on their deposits compared to general citizens.
Repo rate – This rate is set by the Reserve Bank of India’s Monetary Policy Committee. The apex bank provides overnight loans to the banks. The higher the repo rate, the higher are the FD rates offered by banks and vice versa.
Reverse repo rate – This is the rate at which RBI avails loans from banks. Similar to the repo rate, it is also directly proportional to FD rates.
Tenure of deposit – Kotak FD rates also vary based on the tenure for which an individual locks in their deposit.
Deposit amount – Lastly, the deposit amount also influences Kotak Bank FD rates.
How to Calculate Kotak Fixed Deposit Interest?
In order to calculate FD interest for accounts with a maturity period above 181 days, Kotak Mahindra Bank utilises the following formula:
A = P (1 + r / n) nt
A = Maturity amount
P = Principal amount
r = Rate of interest
n = frequency of compounding of interest
t = maturity period
How is TDS calculated on Kotak Mahindra Bank FD Interest?
If the interest an individual earns from all his/her deposit accounts in a particular year is equal to or more than Rs.40,000 then it is subject to 10% taxation. For senior citizens, the threshold is Rs.50,000. Typically, this taxation happens under the purview of the designated bank. However, general citizens and senior citizens can submit Form 15G and 15H respectively to prevent tax deduction at source and instead pay the tax themselves when they file their IT returns.
To submit these forms, one must, however, satisfy certain criteria. For instance,
For Form 15G – One has to be a member of HUF or a resident individual below the age of 60 years. His/her income earned must not be taxable.
For Form 15H – One has to be a resident individual or a member of HUF above 60 years of age. His/her total income generated during the particular FY must not be taxable.