Loan Against FD - SBI

The State Bank of India offers its customers with loan against their fixed deposits. The loan against FD by SBI is a demand or overdraft loan given to clients who already have fixed deposits in the SBI. It is mainly constructed to help customers meet their financial needs regarding home construction, education, renovation, vehicle purchase, etc.

This allows customers to take loan against the existing FD as collateral. One can get loan amount upto 90% of the principal FD amount while applying for SBI loan against FD. The initiative is beneficial for those looking to get a loan at lower interest rate as compared to loans offered by other financial institutions. 

Features of Loan Against FD SBI

The table below shows the major features of SBI loan against fixed deposits that one must consider before applying:

Benefits of Loan Against FD from SBI

Here are some of the benefits of taking a loan against FD from the State Bank of India:

• SBI offers loans up to 90% of the total value of the term deposit.
• SBI offers both demand and overdraft loans that can be availed according to the needs of an individual. 
• The minimum loan amount is Rs. 25k in the case of an online overdraft loan against SBI FD - while the maximum amount is Rs. 5 crore. But, you cannot exceed more than 90% of the amount in one's SBI term deposit.
• No processing charge will be imposed on the individuals who have SBI loans against FD.
• The security interest is given to the FDs. It makes the loan repayment incredibly simple. Even after the loan repayment tenure, the borrower can earn interest on the existing FD which they can utilize to pay their loan EMIs.
• The  repayment period for State Bank of India loan against FD is determined majorly by the individual's repayment capacity. The maximum repayment tenure ranges from 3 years to 5 years. 

Also, check - SBI FD interest rates 2023

Eligibility for Loan Against FD of SBI

One must meet the following the eligibility criteria while applying for loans against FD SBI:

• The applicant must have a SBI Fixed Deposit account.
• The applicant should be 21 years of age.
• The applicant's FD, which is being used as collateral for the loan should not cross the maturity period.
• Individual customers of SBI Bank who have TDR, e-TDR, STDR, or e-STDR are eligible to use this facility.
• This loan is also available to customers who have registered with SBI for RD/e-RD/RFC/NRE/FCNR (B) deposits.
• Businesses are able to use this service if they are a sole proprietorship or partnership firm.

How to Apply for SBI Loan Against FD?

One need to have a loan account or an overdraft account with the State Bank of India to opt for loan against fixed deposit from SBI. Below are the steps that must be followed to apply for SBI Loan Against FD:

• Step 1: You will have to sign in to your State Bank of India net banking account with the user ID and password.
• Step 2: You will have to go to the menu section and tap on the e-fixed deposit option.
• Step 3: Choose the overdraft against the Fixed Deposit option from the displayed menu.
• Step 4: Once you have chosen it, you can view the active deposits on the screen. You will have to choose the FD against which you wish to apply for the overdraft.
• Step 5: Choose the proceed button and then confirm the overdraft amount with the interest rate applicable on the overdraft as well as the expiry date.
• Step 6: Now, you will get a security password on the registered phone number, you will have to authenticate it by entering it in the needed field, and your account will be activated.