State Bank of India (SBI) offers best Fixed Deposit (FD) rates in the industry for individuals and senior citizens. An SBI FD scheme is a best savings solution that is safe and offers guaranteed returns. SBI offers a wide range of fixed deposit schemes that gives good interest rate and flexible tenure options. Use an FD Calculator before applying for an SBI FD to know how much interest you will earn out of the investment. The highest interest rate offered on an SBI FD is 6.25% for individuals and 6.75% for senior citizens. Funds can be deposited for tenure that ranges from a minimum of 7 days to a maximum of 10 years. Fixed deposits are one among the most sought after investment schemes in India and are less risky.
SBI FD rates
SBI offers competitive interest rates and a range of tenure options on all FDs. SBI FD rates generally range from 5.25% to 6.25% for individuals, and 5.75% to 6.75% for senior citizens. Below is a brief summary of the SBI fixed deposit interest rates. Investors can choose short-term, medium-term or long-term term deposits. For deposits held from 7 days to 45 days, the interest rate offered is 5.25%, and for time deposits held from 46 days to less than two years, the interest rate is 6.25%. On the other hand, the rate of interest on deposits held from 2 years to 10 years is 6%.
All senior citizens are offered an additional interest rate of 0.50%, which is over and above the regular FD rates. The highest rate of return on senior citizen FDs is 6.75% for deposits held from 2 years to 10 years. The interest rate usually depends on the time period of the investment and the type of interest compounding frequency.
SBI FD rates for Regulars
|Tenure||Rate of interest|
|7 days to 45 days||5.75%|
|46 days to less than 2 years||6.40%|
|2 years to 10 years||6.50%|
*For deposits less than Rs.1 crore
SBI FD rates for senior citizens
|Tenure||Rate of interest|
|7 days to 45 days||6.25%|
|46 days to less than 2 years||6.90%|
|2 years to 10 years||7.00%|
*For deposits less than Rs.1 crore
SBI FD Calculator: To calculate FD maturity value and interest
Calculating the interest earned on an FD is easy and can be done online using an FD calculator. The interest earned and the maturity value of the deposit can be calculated by taking into consideration factors such as principal amount, the rate of interest, tenure and interest compounding frequency. For example, if you invest Rs.50,000 for 6 months at an interest rate of 6.25%, the maturity value will be Rs.51,574 and the total interest earned will be Rs.1,574. On the other hand, if you invest the same amount for 1 year at the same rate of interest, the maturity value will be Rs.53,199 and the total interest earned will be Rs.3199.
- Deposit Amount: Rs.50,000
- Rate of Interest: 6.25%
- Tenure: 6 months
- Maturity Amount: Rs.Rs.51,574
- Total Interest Earned: Rs.1,574
Eligibility – Who can open an FD account with State Bank of India
Any individual, private or public limited company, Hindu Unified Family, trust, partnership firm or society is eligible to open a fixed deposit account with SBI. In the case of individuals, the terms and procedure for opening a fixed deposit account with SBI is the same as that for the savings account.
What Fixed Deposit Schemes does State Bank of India offer?
SBI has plenty of schemes to choose from when it comes to picking a term deposit that is ideal for your personal needs. Some of them are:
- SBI Tax Savings Scheme, 2006: Under this scheme, any individual who is a resident of India or is the Karta for a HUF and has a PAN number can apply for a term deposit. The minimum deposit amount is Rs.1,000 and the maximum amount in a year is Rs. 1.5 lakhs. The minimum period is 5 years and the maximum 10 years. The interest paid is 6% in case of individuals and it is 6.5% since senior citizens get an additional interest. The deposit, under this plan, cannot be terminated before the initial 5 year period is over.
- Reinvestment Scheme: In the Reinvestment Scheme the deposit can be made for a minimum of 6 months to a maximum of 10 years. The interest paid is compounded and paid when the term deposit matures. In case the amount deposited is less than Rs.15 lakh, any premature withdrawals will attract a penalty of 0.50% per annum provided the deposit has been with the bank for a minimum of 7 days. No penalty charges will be applicable for amounts in excess of Rs. 15 lakh.
- SBI MODS: These term deposits offer overdraft facilities and must be opened in combination with a savings bank account. The minimum amount for such a deposit is Rs.10,000 and the time periods for them range from 1 year to 5 years. Withdrawals from this deposit can be done in multiples of Rs.1,000 via cheques.
- Annuity Deposit Scheme: Under this scheme, a person can deposit a lump sum and start receiving equated monthly instalments of the amount deposited and the interest on the reducing amount, which starts a month after the deposit is made. The minimum amount for this scheme is Rs.25,000 and can be opened for periods of 3, 5, 7 or 10 years.
- SBI Flexi Deposit Scheme: This scheme offers customers the opportunity of depositing different amounts instead of one fixed amount. The minimum amount that can be deposited in a year is Rs.5,000 and can be made anytime during a month with no limit on the number of deposits each month. The period such a deposit can be made for ranges from 5 to 7 years.
What is the minimum amount required to open an FD account with SBI?
Since State Bank of India offers a wide variety of schemes for fixed (term) deposits and the minimum amount may vary from scheme to scheme but the absolute minimum that can be deposited is Rs.1,000. The highest minimum amount payable is for the Annuity Deposit Scheme which is Rs.25,000.
What is the maximum amount that can be deposited in an SBI FD account?
The State Bank of India has no limit on the amount a person can invest in a fixed deposit with them.
What is the minimum / maximum period for which funds can be held in as fixed deposits with State Bank of India?
The minimum and maximum periods for funds to be held with SBI vary with the scheme that you choose. As such the minimum period is 7 days and the maximum period is 10 years. The minimum and maximum periods for each of their schemes are:
- SBI Tax Savings Scheme, 2006: 5 years- 10 years
- Reinvestment Scheme: 6 months – 10 years
- SBI MODS: 1 year – 5 years
- Annuity Deposit Scheme: 3 years- 10 Years
- SBI Flexi Deposit Scheme: 5 years – 7 years
What is the procedure to open a fixed deposit account in State Bank of India?
An FD can be opened online through an SBI internet banking account at the click of a button in a matter of minutes. The other method is to fill out the KYC form and provide identity and address proof. You may also need someone to introduce you to the bank. In most cases, you need not have an account or a past relationship with SBI but in case you are going in for the SBI MODS scheme, you will need to open a savings bank account as well.
What are the interest rates offered on State Bank of India fixed deposits?
The interest rates offered by SBI vary according to the duration of the deposit. It can be anything from 5.25% to 6.25% per annum. In case the depositor is a senior citizen then they are eligible to receive an extra interest of 0.50% over the offered interest rate but the eligibility for this special interest rate calls for the person to be above 60 years of age and a resident of India. This special interest is also applicable only on fixed deposits made for durations of 1 year or more.
Does SBI offer tax saver fixed deposits?
Yes, SBI does offer tax saver fixed deposits. It is called the SBI Tax Savings Scheme, 2006 under which you can deposit up to 1.5 Rs.lakh each year and claim tax benefits under section 80C. However, these deposits have a lock-in period of 5 years.
Are FD accounts with SBI taxable?
Yes, interest earned on term deposit accounts with SBI are taxable and the tax will be deducted at source according to provisions of the Income Tax Act unless the depositor has furnished forms 15G & 15H; in which case no tax will be deducted at source. The tax deducted will be deducted according to the relevant income tax rates when the account holder files his/her returns at the end of the financial year.
What are the main features of State Bank of India’s fixed deposit schemes?
Since SBI offers such a wide variety of fixed deposit schemes to pick from, the features are also varied. The features you may expect to see associated with SBI fixed deposits may be:
- Tax benefits under section 80C
- Extra interest of 0.25% payable to senior citizens
- Loan and overdraft facilities of up to 90% of the deposited amount
- Auto-renewal facility when a maturity period has not been defined
- Linking of TDRs to saving / current account to allow periodic withdrawal of interest earned
- Nomination facilities
- Interest rates will remain the same as they were at the time of opening the FD regardless of changes made to the scheme after the FD was opened. New interest rates will be applicable only on the renewal of the deposit.
- No limits on the amount that can be invested.
Are loans provided against FDs at State Bank of India?
Yes, some of the fixed deposit schemes offered by SBI allow you to take loans against the amount deposited. However, the amount may vary from scheme to scheme. If you have gone in for a Reinvestment Plan fixed deposit, then you can take a loan of up to 90% of the deposited amount, but if you have taken an Annuity Deposit Scheme then you can take a loan of up to 75%. Even with the SBI Flexi Deposit Scheme you can take a loan against the amount deposited.
Does SBI offer senior citizens special rates on their fixed deposits?
Yes. If you are a senior citizen or a pensioner above the age of 60 years and are opening a fixed deposit for a term longer than 1 year then you are entitled to receive 0.50% extra interest over the prescribed interest rate for the selected time period.
Does SBI issue credit cards against fixed deposits held in State Bank of India?
Yes. You can take a credit card against a fixed deposit with State Bank of India. These secured credit cards afford you a credit limit in line with the funds held under the related FD scheme. The credit limit is usually a lower percentage than that of the total funds held but for certain deserving customers, it may go up to 100%. In case of defaults regarding payments on this card, dues will be adjusted against funds held in the FD.
Does SBI allow for premature withdrawals?
In the case of domestic deposits, if the fixed deposit is opened under the SBI Tax Savings Scheme, 2006, then premature withdrawals will not be possible before the lock-in period of 5 years is completed. For all other schemes, premature withdrawals will be permitted. If the deposit if of less than Rs.5 lakh then there is no penalty charged for premature withdrawals provided the deposit was with the bank for at least 7 days. For all other deposits of less than Rs.1 crore, a penalty of the reduction of the interest rate by 1% will be applicable. However, if you are a part of the SBI staff or have opened a pensioner deposit than you will be exempt from paying any penalties for premature withdrawals.
For NRE and FCNR deposits, if the premature withdrawal happens within the first year of opening the deposit than no interest will be paid. In some cases, a penalty may be applied on premature withdrawals which will be a reduction of the interest rate by 0.5% to 1%.
Can NRIs open a fixed deposit with SBI?
Yes, NRIs can open fixed deposits with SBI. The can either open SBI NRE, NRO or FCNR deposits. NRE and NRO deposits will be held in rupees while the FCNR deposit can be opened in foreign currencies.
With NRO term deposits, you can earn interest based on the duration of the deposit and the category your deposits fall under (less than Rs.1 crore and more that Rs.1 crore). The duration of these deposits can range from 7 days to 10 years and the interest will range from 6% per annum to 8.25% per annum based on the duration of the FD.
NRE deposits can be opened for a minimum of 1 year and a maximum of 5 years and the interest you can earn will range from 8% per annum to 8.5% per annum.
In the case of FCNR deposits, you will be able to open these deposits in USD, GBP, Euro, CAD, AUD and JPY. The duration of these deposits can be a minimum of 1 year and a maximum of 5 years and the interest earned will depend on the currency you open the account in.
How to close an SBI fixed deposit account online?
An SBI fixed deposit account can be closed online without any hassles in a matter of minutes. To close the account online, one must have an active internet banking ID and password.
How to close an SBI FD
- Log on to the SBI website
- Log on to internet banking by providing the username and password
- Click on the fixed deposit option
- Choose the type of FD account you want to close and click on ‘Proceed’
- Choose the ‘Close account prematurely’ option
- Click on the ‘Confirm’ button to close the account. Please note that once the ‘Confirm’ option is chosen, the account will be closed. One cannot go back to choosing this option.
State Bank of India is a government-owned corporation which was, until 1955, known as the Imperial Bank of India. The Government of India holds 58.6% shares in SBI and the remainder is divided amongst other shareholders. One among them is Life Insurance Corporation of India which is not a promoter for SBI but still holds 14.99% shares in the bank.
With over 14,000 branches spread across India, SBI has a massive domestic presence which keeps increasing as it acquires more state banks. State Bank of India also has more than 150 branches in over 30 countries and can be found in cities like Ramat Gan, Toronto, Moscow, Frankfurt, Colombo, Tehran, Hong Kong, London, Johannesburg, Los Angeles and even Sydney.
The bank started out with 8 subsidiary banks but now, after 3 were absorbed into SBI, it is left with only 5 which are State Bank of Bikaner & Jaipur, State Bank of Hyderabad, State Bank of Mysore, State Bank of Patiala and State Bank of Travancore. Apart from its banking subsidiaries, SBI also has non-banking subsidiaries which are:
· SBI Capital Markets Ltd
· SBI Funds Management Pvt Ltd
· SBI Factors & Commercial Services Pvt Ltd
· SBI Cards & Payments Services Pvt. Ltd.
· SBI DFHI Ltd
· SBI Life Insurance Company Limited and
· SBI General Insurance