State Bank of India Deposit Schemes: The state bank of India is a public-sector multinational bank. It was founded in 1806 under the name Bank of Calcutta. At present, the SBI headquarters are present in Mumbai, and Maharashtra, and in terms of assets and market value it the largest operating bank in India.
The SBI has more than 24,000 branches across the country, and the bank is opening new branches from time to time. Besides operating within the country SBI is operating in 36 other nations around the world. Millions of customers keep and maintain accounts in the SBI.
However, if you want to earn higher interest income from surplus funds, you can opt for investment with fixed SBI deposits. These plans offer significant returns without the potential risk of a deposit.
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What is the State Bank of India Deposit Schemes?
Currently, SBI offers 5 different types of deposit schemes for its customers with different benefits and features. Here in this blog post, we will take a look at these state banks of India deposit schemes.
Term Deposit Scheme SBI
In the state bank of India, deposit schemes term deposit scheme is one of the schemes in which an investor can invest for a period from 7 days to 10 years. Rs. 1,000-00 is the minimum amount to be invested. Early withdrawal of funds is available you can also get a loan against your investment.
SBI Term Deposit Scheme Features
- The maturity of the plan is 7 days to 10 years
- The rate of interest for this plan is from 2.90 percent to 5.40 percent per year
- 5.40 percent is the highest rate of interest on this plan
- The least deposit amount is 1,000-00
- No limit for maximum deposit
- Additional 0.50% interest rate for senior citizens
- Interest rate is paid on a monthly, quarterly, or yearly basis
- You can withdrawal your funds prematurely
- The account holder can avail loans and overdrafts up to 90% of the deposit value
- Rs. 25,000 to 5 crore overdraft limit
- The interest rate on the loan is 1% higher than the FD interest rate
- According to Income Tax Act, TDS (Tax Deduction at Source) applies to the interested amount
- A nomination facility is available
- Auto-renewal option is available for the scheme
- AT any point an investor can convert interest payout frequency to cumulative payout
Tax Saving Fixed Deposit Scheme
SBI tax saving scheme offers the investor an opportunity to get attractive interest rates on their deposits. The investment under the SBI tax-saving fixed deposit plan is fixed for 5 years. You can invest a maximum of Rs. 1.5 lakhs in this scheme. But premature withdrawal and loan against this plan are not available.
An investor can get a 5.30 percent interest rate per annum while the interest rate for senior citizens is 5.80 percent per annum.
Features of Tax Saving Fixed Deposit Scheme
- An investor can invest a minimum of Rs. 1,000 and a maximum of Rs. 1.5 lakhs
- Deposits maturity period is 5 and 10 years
- The interest rate under this scheme for the general public is 5.40% per annum while senior citizens will get 5.80% per annum
- An investor is eligible to get tax benefits under Section 80C of the Income Tax Act 1961
- Two variants of this plan are available:
i) TD (term deposit)
ii) STD (special term deposit)
- The facility of nomination is available
- There is a 1% more return rate for the SBI staff and pensioners than the applicable rate.
Fixed Deposit Reinvestment Scheme
Regular fixed deposits provide an investor an option to withdraw the earned interested amount at regular intervals. But reinvestment scheme does not pay the earned interest to the investor instead the plan takes that interested amount and adds it to the principal amount then the entire amount earns compound interest.
When the reinvestment plan matures the investor can withdraw the principal amount along with all the interest that has been earned up to maturity. The reinvestment plan’s maturity period is between 6 months and 10 years.
From Rs. 1,000 an investor can start to invest in the plan. Loan and premature withdrawal are available under this scheme. So in the state bank of India deposit schemes, the reinvestment scheme is one of the profitable schemes.
Reinvestment Scheme Features
- Interest earned is added to the principal investment continuously
- The interested amount earned is credited into your account at the time of maturity
- You can invest a minimum of Rs. 1,000 in this scheme
- No upper limit on investment
- An investor can choose the maturity period between 6 months to 10 years
- You can choose a nominee for this plan
- Availability of loan and premature withdrawal facility
- Up to 90 percent overdraft of principle amount is available
- The scheme is for individual or joint investment
Multi Optional Deposit Scheme
An SBI multi-optional deposit plan is a term deposit associated with an individual’s savings or current account. Term deposits are normally fully liquidated whenever an individual needs money. Under the SBI MOD plan money can be withdrawn from the MOD account by an individual in multiples of 1000 as per his need.
The balanced amount in the Multi Optional Deposit scheme account will continue to generate fixed deposit interest rates applicable at the time of the first deposit. SBI MOD is a profitable plan for investors due to its accessibility and reasonable interest rate.
An investor can invest a minimum amount of Rs. 10,000 in this plan with a tenure ranges between 1 and 5 years.
Features of Multi Optional Deposit (MOD) Plan
- You can open a MOD account by depositing a minimum amount of Rs. 10,000, and thereafter deposit in multiples of 1,000
- 1 to 5 years is the tenure range for the MOD plan
- There is no upper limit on the deposit
- MOD deposit interest rates are the same as for the term deposits. For general customers, interest rates of SBI fixed deposits vary between 2.9 percent to 5.4 percent. And these interest rates are effective from January 08, 2021
- The scheme facilitates premature withdrawal of funds, but with a penalty. For premature withdrawal of fixed deposits up to 5 lakhs you have to pay a penalty of 0.5%. The applicable penalty is 1 percent for fixed deposits above 5 lakh but below 1 crore.
- A loan facility is also available
- Facility of nominee
- TDS (tax deduction at source) applies to MOD
Annuity Deposit Scheme
Under the Annuity Deposit plan, the SBI provides investors a fixed amount every month after they deposit a lump sum amount. A fixed amount is paid to the investor through equal monthly installments.
The EMI consists of the portion of the principal amount and interest on the principal reduction, compounded by the quarterly basis and discounted to the monthly amount. Thus, the deposits deposited by the customers are returned to them in the form of monthly installments with interest.
The minimum investment amount to be invested under this scheme is Rs. 25,000. 36, 60, 84, and 120 months are the tenure period of this scheme. Early withdrawal is allowed in case of the death of the investor.
Features of Annuity Deposit Scheme
- Different deposit periods are available for the Annuity deposit scheme
- An investor can choose a tenure period of 36, 60, 84, or 120 months
- All branches of SBI provide this plan
- Rs. 1,000 is the minimum monthly deposit amount
- An investor can start investing in this plan with a minimum amount of Rs. 25,000
- No limit on the maximum amount
- The interest rates will be as per the interest rates of term deposit rates
- There is a 0.50% more interest rate than the applicable rate for senior citizens who are 60 or above 60 years.
- Loan facility up to 70 percent of the balance amount is available
- A nomination facility is available
- The scheme is accessible for 3, 5, 7, and 10 years
Eligibility For SBI Deposit Schemes
- Any citizen of India
- Minors under the supervisions of their parents or gardens
- Educational institutes and institutes of charity
- Members of undivided Hindu family
- Agencies, societies, and clubs
- NRIs having NRE/NRO account
- Partnership firms
All of the above are eligible to invest in SBI deposit schemes.
Documents Required to Invest in SBI Deposit Schemes
- Address and identity proof documents such as:
- Voter ID card
- Aadhaar card
- Driving license
- PAN card (Permanent Account Number)
- NREEGA card
The above-mentioned state bank of India deposit schemes is good investment options for those who want to earn good returns on their investments.
Rs. 1,000 is the minimum deposit amount for most of these schemes. But for multi-option scheme Rs. 10,000 is the minimum investment amount and for an annuity plan, the minimum investment amount is Rs. 25,000.
The interest rate under these schemes is between 2.90 to 5.40% p.a. There is an additional 0.50% interest for senior citizens on all tenures.