State Bank of India (SBI) is one of the best banks in India having branches across the globe. It is the largest bank in the country with about a quarter of the market share. This reliable bank offers several banking schemes products and one such scheme is the Fixed Deposit (FD) account.
FDs are by far the most trusted way to save for customers of all age groups due to their guaranteed returns feature. The bank offers attractive interest rates on the deposits of the customers for the tenure as chosen by the customers.
The FD scheme, interest rate, eligibility criteria are being discussed in this article.
as per latest update
State Bank of India is offering attractive interest rates on FDs with tenures ranging from 7 days to 10 years with many attractive benefits. Here senior citizens are offered an additional interest rate of up to 0.8%. The interest rates for the general public range between 2.90% to 5.40% p.a.
State Bank Of India FD Interest Rate 2022
The table below shows the interest rates for FDs on amounts less than Rs 2 crore, from January 15, 2022.
|tenure||Revised rates for public to be applicable from 15.01.2022||Revised rates for senior citizens with effect from 15.01.2022|
|7 days to 45 days||2.9%||3.4%|
|46 days to 179 days||3.9%||4.4%|
|180 days to 210 days||4.4%||4.9%|
|211 days to less than 1 year||4.4%||4.9%|
|1 year to less than 2 years||5.1%||5.6%|
|2 years to less than 3 years||5.1%||5.6%|
|3 years to less than 5 years||5.3%||5.8%|
|5 years to 10 years||5.4%||6.2%|
- Remember the interest rates of each bank are subject to change from time to time.
Different Types of State Bank of India FD Schemes
FD (Fixed Deposit)
Deposit money in fixed deposit account and get guaranteed returns. You can also withdraw your investment ahead of time. The minimum deposit period is 7 days and the maximum can be done is up to 10 years. The minimum deposit amount is Rs 1,000. Senior citizens can get an additional 0.25% interest rate on deposits above Rs 10,000.
annuity deposit scheme
This account allows you to make a one-time deposit and get Equated Monthly EMIs, where a portion of the principal amount is paid back with interest on the reducing principal amount. The interest is compounded at an interval of 3 months and the monthly value is discounted.
The tenure of the deposit can be 36, 60, 84 and 120 months. The deposit should be made in such a way that the minimum monthly annuity for the chosen tenure is Rs.1,000. Also, the minimum deposit amount cannot be less than Rs 25,000.
multi option deposit
This type of FD scheme will be linked to your savings or current account. You can make withdrawals from this account in units of Rs 1,000 as per your requirement. Interest will continue to accrue on the balance in the account at the initial rate. You can choose the tenure from 1 year to 5 years. The minimum amount to deposit is Rs 10,000.
Motor Accident Claims Annuity Deposit (MACAD)
This account is dedicated to credit the compensation paid to the claimants who have suffered from motor accidents. The credited amount will be paid to the victims in monthly annual installments, with interest as a part of the principal amount.
The minimum monthly annuity for the specified period is stated to be Rs 1,000. The tenure can range from 36 months to 216 months as told by the Court.
The interest earned on this account will be paid only on maturity, unlike other schemes where it is paid on regular basis. This means interest is added back to the principal and compound interest will be calculated and paid on it.
The period of deposit can range from 6 months to 10 years. Deposits of Rs 1 crore and above will be treated as bulk deposits.
Benefits of doing FD in SBI
- The minimum deposit period for opening an FD account is 7 days.
- The maximum deposit period for an FD account is 10 years.
- The minimum deposit amount is Rs 1,000.
- You can open an FD account online or by visiting the nearest SBI branch.
- Avail attractive interest rates on all tenors and schemes.
- Senior citizens above 60 years of age, SBI employees and SBI pensioners get additional interest rates.
- Nomination facility is also available.
- Can transfer the account to other branches of SBI.
- Interest payments can be made monthly, quarterly, half-yearly, yearly or on maturity depending on the plan chosen.
Documents Required for FD in SBI
- pan card
- voter id card
- Driver’s license
- Aadhar card
- Aadhar card
proof of date of birth
- discharge certificate
- pan card
- Aadhar card
- voter id card
Tax Benefits on State Bank of India FD
State Bank of India offers ‘SBI Tax Saving Scheme, 2006’ where the minimum deposit amount is Rs 1,000 and in multiples of Rs 100 thereafter. The maximum amount you can deposit in the account is Rs 1.5 lakh. Though the lock-in period of the account is 5 years, the tenure of the account can be up to 10 years. By depositing money in this account, you will get income tax benefits under section 80c of the Income Tax Act, 1961.
Senior citizens get an additional interest rate of 0.5% on the applicable rate. Similarly, SBI employees and pensioners are subject to an additional interest rate of 1% over the applicable rate.
In addition, tax will be deducted by the bank based on the interest earned by you on the bank’s FD account. TDS will be applicable at 10%. This has now been reduced to 7.5% due to the pandemic taking effect between May 2022 and March 2022. If your annual income is less than the basic exemption limit, you can submit Form 15G/15H to the bank requesting not to deduct tax at source.
Is there a penalty for premature withdrawal?
Yes, premature withdrawal usually comes with penalties. For deposits up to Rs 5 lakh, a penalty of 0.50% will be levied for all tenures. On the other hand, a penalty of 1% is levied on deposits between Rs 5 lakh and Rs 1 crore on all tenors.