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Indian Bank Fixed Deposit (FD)

Indian Bank is a state-owned financial and banking service provider. Established in 1907 in Chennai, Indian Bank’s business today has crossed Rs. 430,000 Crore. It operates 227 Overseas Correspondent banks across 75 countries.

An upcoming merger with Allahabad Bank in April 2020 is all set to make Indian Bank the seventh-largest bank in India.

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One of the significant financial products offered by the financial institution is Indian Bank FD schemes. These products can help individuals grow their wealth with minimal risk.

Benefits of Choosing Indian Bank FD

Before opening a fixed deposit account with the bank, investors must understand the advantages of investing here. Here is a look at some of the benefits of Indian Bank fixed deposit scheme.

  • The schemes offer automatic renewal options for the investment, post their maturity date.
  • Investors are free to nominate a beneficiary for the Indian Bank fixed deposit scheme.
  • Easy liquidity option that does not compromise interest earnings for investors is also extended on such schemes.

Eligibility Criteria for Indian Bank FD

Investors must meet the following requirements when looking to invest in Indian Bank FDs.

  • Must be an individual or joint FD account holder in the bank.
  • NRIs are eligible to invest through NRE and NRO accounts only.
  • Member of Hindu undivided family or HUF.
  • Minors can invest in these FDs as well, but require assistance from parents or guardians.
  • Trusts, public and private limited organisations, partnerships and sole proprietorship concerns are also eligible for such investments.

Documents Required for Indian Bank FD

Investors must ensure that they have the following documents handy when starting an Indian Bank FD investment.

  • Proof of Identity
    • Pan card
  • Voter ID
  • Aadhaar card
  • Ration card including a photograph
  • Driving license
  • Senior citizen ID
  • Passport
  • Proof of Address
  • Electricity bill
  • Telephone bill
  • Bank statement with cheque
  • Passport
  • Identity card issued by Post Office

Customers also need to furnish two passport-sized photographs at the time of investment initiation.

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Indian Bank FD Rates

Indian Bank offers an attractive interest rate of up to 6.00% to regular investors for a term of one year. Senior citizen investors, on the other hand, are eligible for higher returns from the scheme. When understanding Indian Bank fixed deposit details, investors must know that senior citizens are liable to receive up to 6.50% per annum.

TenureNon-senior citizen and NRO FD (%)Senior Citizen FD (%)
7-45 days4.50%5.00%
46-90 days5.00%5.50%
3-4 months6.00%6.50%
4-6 months6.25%6.75%
1-2 years6.60%7.10%
3-10 years6.00%6.50%

Different Types of Indian Bank FD Schemes

Indian Bank provides several options when it comes to FD investment. Customers need to understand each product before picking the perfect investment scheme for them.

  • Indian Bank Facility Term Deposit Scheme – This scheme is perfect for those looking for enhanced tenure flexibility. Investors can opt for investments terms ranging between 7 days and 10 years. The minimum investment quantum is Rs. 100. However, there is no upper limit for the investment. Residents, HUF members, Private & Public limited companies can invest in this scheme.
  • Indian Bank Senior Citizen Term Deposit Scheme – As the name suggests, individuals above 60 years are eligible to invest in this scheme. In case of joint accounts, the first account holder must be a senior citizen. The minimum investment amount is Rs. 100, while the maximum quantum is Rs. 5 Crore.
  • Indian Bank Tax Saver Term Deposit Scheme – This is the only tax saving Indian Bank FD scheme. The minimum tenure for investment is 5 years. Individuals can only invest as much as Rs. 1.5 lakh through this scheme.
  • Indian Bank Facility Deposit Scheme – This scheme offers a shorter maturity period, ranging from one year to three years. However, the minimum deposit required is relatively higher, at Rs. 10,000.
  • Indian Bank Re-Investment Term Deposit Scheme – With a tenure ranging between 6 months and 10 years, this scheme reinvests the total amount on disbursed on maturity in a similar scheme with the same tenure. Therefore, investors of this scheme cannot avail cash returns from the FD.

Premature Withdrawal Terms and Conditions

Premature withdrawal refers to closing the FD account before it matures. Such withdrawal facility is available for most Indian Bank fixed deposit plans. However, investors will need to pay a 1% penalty for this transaction.

Premature withdrawal is unavailable to those investing in Indian Bank Tax Saver Term Deposit scheme. In this plan, the deposited amount remains locked in for a 5-year term without the option for removal or foreclosure.

Special Forms to Fill

Fixed deposit earnings are liable for tax deductions. To avail tax rebate if your total interest income is less than Rs. 40,000 and Rs. 50,000 for senior citizens, investors need to fill up Forms 15G and 15H respectively. Failure to do so results in taxation on interest earnings even when the investor is not liable for TDS.

Loan against Indian Bank FD

Indian Bank FD customers can avail a loan against their investment. The limit is set at 90% of the FD valuation. The interest rate levied is between 5% and 7.5%. The maximum tenure for such a loan coincides with the maturity term for the FD.

FAQs

  • What is the highest FD rate for Indian Bank investors?

Regular investors can earn as much as 6.40% on their FD investments. Senior citizens, on the other hand, can earn up to 6.90% per annum.

  • What is the minimum investment amount for these FD plans?

Investors can start deposits with as low as Rs.100 investments.

  • Can investors change the tenure of an existing Indian Bank FD?

No. Once started, FD tenures are fixed and cannot be altered. However, if they want, investors can close their current investment and open another FD account with the preferred term.

  • Can an individual open Indian Bank FD account online?

Yes. Indian Bank supports online FD investment application. After the online application, a bank representative will get in touch with the investor to complete the process.

  • Can investors deposit an additional sum in their existing FDs?

No. Adding funds to an existing Indian Bank fixed deposit scheme is not possible. Instead, investors can create a second FD investment with that additional money.

  • Is there a penalty for premature withdrawal?

Yes. Withdrawal of the FD investment before maturity results in a penalty fee amounting to 1% of the sum liable for return.

  • Can investors close Indian Bank FD accounts at any time?

Yes. In most cases, investors are free to cancel or close their FD investment at any time they want. However, the same facility is absent for Indian Bank Tax Saver Term Deposit scheme.

  • What is the maximum loan against FD amount from such investments?

You can avail a loan valued at 90% of your FDs current value.

  • What is the shortest tenure for Indian Bank Facility Deposit?

The shortest term for such a deposit is 12 months.

  • Which forms to submit to claim tax discounts on FD interest?

Submission of Form 15H/15G is mandatory to avail tax rebates on FD interest earnings for any year.