State Bank of India, or SBI, flexi deposit scheme is a sort of recurring deposit (RD) facility offered by India’s largest bank to its customers. But unlike a recurring deposit account, where you have to deposit a fixed instalment every month, the deposit installment in SBI flexi deposit scheme can vary. Deposits in the SBI flexi scheme can be made any number of times during a year and any time during a financial year, within the annual maximum limit. Investors can choose a deposit amount within the minimum and maximum limits per financial year. SBI also offers account holders the facility to open a flexi deposit account online by using internet banking facility. The maturity proceeds will be transferred to the debit account from which the SBI flexi deposit was funded.
Here are 10 things to know about the SBI flexi deposit scheme:
1) Deposits in the SBI flexi scheme can be made anytime and any number of times.
2) The amount required for deposit in a single instance is Rs 500 or in multiples thereof, according to SBI’s website.
3) In a financial year, the minimum deposit amount required in the SBI flexi deposit scheme is Rs 5,000.
4) The maximum deposit allowed in the SBI flexi scheme amount is Rs 50,000 in a financial year.
5) Penalty charges for default in payment of minimum deposit will be Rs 50 per financial year..
6) SBI flexi deposit scheme has a minimum deposit period of 5 years and maximum 7 years.
7) Senior citizens can avail higher rates of interest in the SBI flexi deposit scheme as compared to others.
8) Depositors in the SBI flexi deposit scheme will earn the same rate of interest as applicable on normal term or fixed deposits. Interest will be compounded at quarterly intervals, based on the balance outstanding on the last date of each month.
9) SBI currently pays an interest rate of 6.85% per annum on fixed deposits of five years and more. Senior citizens get a higher interest rate of 7.35%.
10) Premature withdrawal is allowed from the SBI flexi deposit scheme. But the interest rate in case of premature withdrawal will be 0.50% below the rate applicable for the period the deposit has remained with the bank. Loan facility, as applicable to normal fixed deposits, can also be availed against the SBI Flexi Deposit scheme. Interest payable will be subject to tax deducted at source or TDS rules, as applicable on normal term deposits.