FD Schemes for Child

A fixed deposit account is considered a secure option for storing savings at a bank. It helps you expand your savings by paying a fixed rate of interest and allowing you to withdraw your investment at maturity. Several banks in India offer fixed deposit schemes for children. 

Under the Fixed Deposit scheme for children, the parent or the guardian can open an account on behalf of the child. The child will receive the earnings from the FD until they reach the age of 18 or till the FD reaches maturity. 

Types of Child Fixed Deposit Plans

Below are the list of fixed deposit plans for children offered by different banks in India:

  • PNB Balika Shiksha Scheme

PNB offers this fixed deposit option for children. It can only be opened on behalf of a girl kid, and the deposit can be withdrawn when the girl reaches the age of 18. However, students enrolled in private schools or any central government school are excluded from this scheme.

  • PNB Uttam Non-Callable Term Deposit Scheme

The Uttam Term Deposit Scheme offered by Punjab National Bank is a non-callable scheme. The minimum amount required to open an account under this scheme is Rs.15 lakh. This scheme is available for individuals as well as minors.

  • Yes Bank Fixed Deposit for Child

Yes Bank’s fixed deposit scheme for children offers flexible tenures ranging from 7 days to 10 years. It also offers easy withdrawals and flexible interest-pay options.

  • SBI FD for Child

The SBI Child Plan Fixed Deposit is a risk-free investment scheme offered by SBI to secure the financial future of your child. It offers a decent return with varying interest rates depending on the duration of the account. 

  • HDFC Bank Kids Advantage Account

HDFC Kids Advantage account provides free education insurance cover of Rs.1 lakh to safeguard the future of the child. This is applicable in the event of the death of the parent/ guardian through vehicular accident by road, rail or air.

  • Canara Fixed Deposit Scheme

Canara Bank Child FD scheme allows parents or guardians to open an account on behalf of a minor. The tenure ranges from a minimum of 7 days to a maximum of 10 years.

  • Sukanya Samridhi Yojana

The Sukanya Samriddhi Yojana is a government savings scheme created to secure the future of girls. The parent or guardian of a girl child who is 10 years of age or younger can open an account under this scheme. This scheme carries a higher interest rate along with several tax benefits.

Top FD Schemes for Child in India - Comparative Analysis

Given below is a comparative analysis of different child FD schemes offered by the banks based on the amount, tenure and interest rates: 

List of FD Schemes for Child

FD Schemes for Child 

Amount

Tenure

Interest Rate

PNB Balika Shiksha Scheme

Up to Rs.3000

Up to 18 years

Same as normal FD rates

PNB Uttam Non-Callable Term Deposit Scheme

Lump sum of Rs.15 lakhs

91 days - 10 years

Decided by bank

Yes Bank Fixed Deposit for Child

Rs.10,000 - No Limit

7 days to 10 years

3.25% p.a - 7.50% p.a.

SBI FD for Child

Rs.1,000 - No Limit

7 days to 10 years

3% p.a. - 7.10% p.a.

HDFC Bank Kids Advantage Account

- Rs. 35,000 in Savings Account

-Excess of Rs. 25,000 in Fixed Deposit

1 year 1 day

6.60% p.a.

Canara Fixed Deposit Scheme

Rs. 1,000 - No Limit

7 days to 10 years

3.25% p.a.- 7.15% p.a.

Sukanya Samridhi Yojana

Rs.250 - Rs.1 lakh

21 years

8.2% p.a

Benefits of Child Fixed Deposit Schemes

The benefits of investing in an FD plan for children are as follows.

  • They can be opened for children as young as one year old, allowing parents to save more for a longer investment period.
  • One can open an FD account with a minimum investment of Rs.1000.
  • You do not need to invest on a regular basis.
  • You can save for your child's future or higher education because the FD matures when the child turns 18.

How to Start an FD for Children?

You can open an FD on behalf of your child, and they will receive the earnings when they attain the age criteria of 18 or when the FD matures. The following are the steps to starting an FD scheme for your child:

Step 1: Go to your bank or NBFC and give identity verification for the child and the parent/guardian responsible for the account.

Step 2: In addition to identity proof, you will be required to provide address proof, age proof, and a few passport-size photographs of the child.

Step 3: After submitting the necessary documents and bank/NBFC account information, the information will be verified before opening an account for the child.

Step 4: Following the processing of the documents, a new FD account will be opened for the child, with the parent/guardian acting as the account's caretaker until it matures.

Eligibility Criteria to Withdraw a Child FD Scheme

The student must complete the following conditions in order to withdraw the fixed deposit under the scheme:

  • Has turned 18 years old.
  • Have successfully completed and passed the Class X board exams.
  • The girl recipient completed her studies for at least two years after enrolling in class IX.

Comparison of FD rates

Name
Tenure
Highest Interest Rates
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