|Y Viswanatha Gowd
|Listed on exchange as
|LIC Housing Finance Ltd
The Period that begins from 1 day - 1 year are known as short term fixed deposits, and their interest rates start from 5.25% to 5.5% depending on the number of days of the deposit for general customers, and it is from 5.5% to 5.7% for the senior citizens.
A Medium-term fixed deposit, that is, from 1 year 5 months to 4 years 11 months, withhold interest rates is 5.65% to 5.75% for general customers and is 5.9% to 6% for senior citizens according to the period of lock-in.
For opening a LIC Housing FD account via offline mode, one has to visit the nearest LIC Housing branch. Fill out the LIC Housing FD application form and present all the necessary documents with the deposit amount. On successful application processing, an FD receipt will be provided by LIC Housing.
Individuals or entities satisfying the following criteria can opt for a fixed deposit in LIC–
The following documents have to be furnished for opening a LIC FD–
An investment in LIC Tax Saving FD entitles to tax saving up to Rs. 1,50,000 p.a. No other LIC FDs entitle to tax saving under Section 80C of the Income Tax Act.
Also, note that the interest income from the LIC 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 LIC 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%.
An investor can avail of a loan against LIC FD up to 75% of the deposit amount. The rate of interest will be 2% p.a. above the interest rate of the fixed deposit.
LIC permits premature withdrawal of FDs with a penalty of a 2% rate of interest.
What are the possible LIC FD interest payment options?
The interest on all cumulative term deposits will be paid and compounded annually, and the client will be paid at maturity. Interest will be paid on all non-cumulative time deposits on March 31st of each year.
What are the penalties for failing to give PAN card information while applying for an FD?
The following are the ramifications:
What are the various interest payment options?
Customers have the option of choosing between cumulative and non-cumulative term deposits.
Is it possible for me to create a joint account?
Yes. However, interest payments shall only be made in the name of the original depositor.
How is the account holder's interest paid?
The interest is credited straight to the FD holder's bank account via ECS.
How is premature withdrawal permitted?
Withdrawals are permitted three months from the start of the FD.
3 Months - Less than 6 Months
3% per annum
6 Months - Before Maturity
1% less than the applicable rate
For 6 Months and before maturity: If no interest rate is specified for a given time, the interest due will be 2% less than the lowest rate at which public deposits are accepted.
What are the highlights of the scheme?
The interest rates given by LIC HFL are determined by a variety of variables. Internal and external factors may be included. Some of these factors might include Reserve Bank of India (RBI) regulations, economic circumstances, market volatility, and LIC's liquidity situation. Let us look at a few of these elements:
Economic Conditions: Certain economic changes have a significant impact on the interest rates given by the country's banks and financial institutions. People in most developing economies strive to get credit to satisfy their financial demands. In addition, when credit is in great demand, banks may offer higher interest rates to entice new depositors.
Price Rise: Inflation is one of the primary variables influencing term deposit rates, among others. To a significant part, this affects the interest rates that banks and other financial institutions provide.
A Recession: In most situations, a recession will have a negative impact on interest rates. This is the period when banks and financial institutions will begin to decrease the interest rates on most financial goods.
RBI: RBI rules and guidelines are critical in establishing the economy's interest rates.