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How to Close SBI Fixed Deposits Online?

IndianMoney.com Research Team | Posted On Monday, December 23,2019, 05:15 PM

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How to Close SBI Fixed Deposits Online?

 

 

Bank FDs are a popular investment in India. Conservative investors simply love Fixed Deposits. FDs have a term ranging from 7 days to 10 years. The money is safe and you get interest on the FD. The fixed deposit offers 6.5-7.5% a year. You can continue the FD till maturity or redeem it before end of tenure with a prepayment penalty. You can also avail a loan against FD (This is a loan against 80-90% of deposit value). These loans are much cheaper than personal loans.

How to Close FD?

You would have to surrender the deposit certificate after signing it. You then submit the signed form stating the FD may be closed on the maturity date. After the due date, the maturity proceeds are transferred to your savings bank account. For online FD, you can renew or close FD online.

What Does The Bank Do When FD Matures? Well, the bank has 2 ways of dealing with matured FDs.

The Auto-Renew Option: The bank renews FD automatically for one year. It could also be for the FD original term.

The Auto Liquidation: Your FD gets liquidated and the bank transfers the maturity amount to your SB account.

Want to know more on Fixed Deposits? We at IndianMoney.com will make it easy for you. Just give us a missed call on 022 6181 6111 to explore our unique Free Advisory Service. IndianMoney.com is not a seller of any financial products. We only provide FREE financial advice/education to ensure that you are not misguided while buying any kind of financial product.

See Also: Benefits of Fixed Deposit in India

How to Close SBI Fixed Deposits Online?

Can You Close FD Early?

Well you can, the interest rate is revised and a penalty would have to be paid. When you close the FD, interest is paid as per applicable rates for the tenure the deposit was kept at the bank and then a penalty is levied. After closure the money is credited to your saving bank account.

You could close FD prematurely if you need money for personal use. You can also reinvest the FD and enjoy a higher interest rate. Do look at the prepayment penalty when closing the FD and making a reinvestment.

Steps to close SBI FD Online:

  • You must first log on to your SBI net banking account by typing the User ID and password.
  • Go to the fixed deposit option and click on the e-TDR or e-STDR (FD) option. You then click on proceed.

Note: TDR is the term deposit and STDR is a special term deposit.

  • You then click on the ‘close account prematurely’ option.
  • The screen displays a list of all your fixed deposits with the bank.
  • You then click on the FD you want to close and click on the submit button.
  • You then give the reason for closing the FD and then click on confirm.
  • You get a High-Security Password on registered mobile number.
  • Type the password and then click on the confirm button.
  • A message flashes on the screen which says your e-TD or the e-STD account has been closed.
  • The FD amount is then credited to your savings bank account.

See Also: Is It Good to Invest in Corporate Fixed Deposits?

How to close FD offline?

  • You must visit the bank branch and then get the form for the premature closure of FD.
  • You then fill the form with details like name, FD number and the bank account details.
  • You submit the document at the bank to process the request.
  • When FD is closed, the money gets credited to the savings bank account.

Why You Should Not Close FD?

If you close FD prematurely, you lose the compound interest you could have earned. Then there’s a penalty on interest which varies across banks.

Let’s have an example:

You have deposited Rs 1 Lakh in a bank FD of tenure 10 years. The maturity amount would be Rs 1,95,300 if rate of interest is 6.75%. Now you withdraw the FD after 4 years. The interest rate for FD is 6.75% which you would get with a penalty of 1%. The net rate of interest you get is 6.75% - 1% = 5.75%. You get a maturity amount of Rs 1,25,655. This is a loss of nearly Rs 70,000. So, invest the amount withdrawn from FD only if you can cover this loss. If you need money in a hurry, it would be wise to avail loan against FD.

See Also: Investment Bonds Vs Fixed Deposits: Which Investment is Good?

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