Indian Bank FD Interest Rates, Jan 2019

Indian Bank FD Interest Rates 2019

Indian Bank offers multiple fixed deposit options to their customers to park their surplus savings for a fixed tenure. A customer is required to make a deposit once into their FD account at the time of opening the account with the bank. The customer is not allowed to deposit more money and withdraw any money in the account during the tenure of the deposit. Fixed Deposits of Indian Bank have a higher interest rate compared to their saving deposits. Benefits of opening a FD account in Indian Bank are:

• Automatic renewal facility for equal period
• Nomination facility available
• Earn interest with ease liquidity

FD Rates in Indian Bank

FDs are attractive financial instruments for depositors looking for attractive returns and high safety. FD interest rates in Indian Bank range from 4.50% p.a. to 6.50% p.a. for deposits with a tenure of 7 days to less than 365 days. These deposits are known as short term deposits as they have a tenure of less than 1 year. Short term Indian Bank FD rates for senior citizens range from 5.00% to 7.00% p.a.

Always, compare tenure wise FD rate of banks to choose the FD rate at which the bank offers the highest fixed deposit interest rate and if possible, opt for FD with highest interest rate. Indian Bank FD rates are the highest for the deposits with a tenure of 1 year to 1 year, wherein the FD rate of interest is 6.75% p.a

Indian Bank FD interest rates for long term deposits with tenure of 5 years to 10 years offer good returns. Indian Bank fixed deposit rates for deposits with a tenure of 10 years is 6.00%. Senior citizen are offered deposit rates of 6.50% p.a. for long termed FDs.

Indian Bank Fixed Deposit Rates

Indian Bank offers best FD rate of 6.75% on term deposits for a tenure of 1 year to 1 year. The bank offers special interest rate on FD for senior citizens. Current Indian Bank FD rates for senior citizens range from 5.00% to 7.25%. Fixed Deposits rates of Indian Bank are a function of many factors such as monetary policies of RBI, economic growth rate, credit demand and liquidity position of the bank.

The factors affecting Fixed Deposit interest rates are as follows:

Policies Framed by RBI – As per RBI guidelines, the change in Cash Reserve Ratio (CRR) and repo rate affects the interest rate of all banking instruments including the fixed deposit.

Recession – Recession results in a decrease in the interest rate offered on fixed deposit. At the time of recession, RBI is forced to release the funds in the market which it achieves by lowering the rates on cash reserve of the banks and hence, providing them with additional liquidity. As a result of high liquidity and low credit demand, banks reduce the rates on FD.

Inflation – Inflation has a positive effect on a fixed deposit interest rate. Banks typically fix interest rates of FD in a manner that it is higher than the existing inflation rates. Hence, FD rates tend to be higher in a period of rising inflation.

Current State of Economy – Economic condition of the country is the major factor that affects the fixed deposit interest rate. In a booming economy, people need and are willing to take larger credit to meet their personal and business requirements. In periods of high credit demand, banks offer higher interest rate to garner more funds through fixed deposits.

Indian Bank Fixed Deposit

Description:

• This is a term deposit which reinvests all earned dividends, capital gains, and interest back into buying units or shares, rather than paying out in physical cash.
• Availability of auto renewal facility
• Nomination facility available
• Interest on deposit is compounded quarterly
• Loan facility upto 90 per cent is available on the deposit
• Interest earned on deposit is subject to TDS

Who is eligible?

• Resident Indians, private or public limited company, hindu undivided family, trust and partnership firm

Description:

• This deposit scheme allows the depositor to make investment into the deposit to earn higher returns along with a flexibility and liquidity.
• Automatic renewal facility for equal period
• Nomination facility available
• Earn interest with ease liquidity

Who is eligible?

• Resident Indians, private or public limited company, hindu undivided family, trust and partnership firm

Indian Bank FD Calculator

Indian Bank fixed deposit calculator helps you to calculate maturity value of your deposited amount at the interest rate offered compounded at quarterly. The amount of fixed deposits, interest rates on FD, deposit tenure and compounding frequency of interest together determine the maturity amount of the FD at the end of the tenure.

• Deposit amount – This is the initial amount deposited by a customer in Indian Bank. Bank may allows higher interest rate on larger deposits. Indian Bank offers deposit amount in the range of Rs. 100 to No Limit.
• Rate of Interest - Interest rate is the rate charged by the bank on your fixed deposit. Indian Bank offers a higher rate of interest on fixed deposits of longer tenure and lower interest rate on deposits of less than a year. Highest interest rate offered by Indian Bank is 6.75% for deposit amount below Rs. 1 crore corresponding to a deposit tenure of years months days to years months days .
• Period of deposit - Bank offers low interest rate for short tenure FDs and higher interest rate for long tenure FDs. Bank offers a rate of 4.50% for a 7 Days FD and a rate of 6.00% for a 10 Years FD.
• Interest Compounding Frequency - This determines the frequency at which interest is compounded. Compounding frequency can be monthly, quarterly, half yearly or annual frequency.

Illustration: : Mr. A opens a FD account of Rs. 1 lakh with a tenure of 7 Days at an interest rate of 4.50 %. In this case, the maturity amount at the end of 7 Days will be Rs. 100,086 which includes the principal of Rs. 1 lakh and interest of Rs. 86 is earned on the principal amount during the period. Similarly, you can calculate the interest and maturity amount for higher tenures by using FD calculators.

Indian Bank calculates quarterly interest on its fixed deposits.

FD in Indian Bank – Premature Withdrawal

Premature closure of Term Deposit with Indian Bank is along with the lower interest rate of 1% for deposits above Rs. 5 lakh than the contracted rate. The penal provisions for premature closure on Indian Bank FD are subject to change from time to time and may also vary with deposit schemes.

Loan against Fixed Deposit Indian Bank

Indian Bank offers loan up to 90% against its own deposit. Note that Indian Bank will not give you loan against FD of any other bank. Indian Bank offers Loan against FD at the rate of 5.5% to 7.75%

Maximum loan tenure is restricted up to the maximum tenure of the FD.

Illustration - Mr. Rahul has opened a fixed deposit of Rs. 100,000 for 2 years in Indian Bank. The borrower later decided to take loan against his FD. The bank has approved a credit limit of 90% against his FD at 10% interest rate. Now, if the borrower draws Rs. 90,000 on the first of the month and then repays the money on the 1st of next month, then he is supposed to pay the interest on Rs. 90,000 availed for 1 month only. The amount he repays after 1 month is Rs. 90,744. So, the interest charged on the loan taken is Rs. 744.

Documents required to open Fixed Deposit Account in Indian Bank

• PAN Card
• 2 Photographs
• Identity Proof: PAN Card, Voter ID Card, Passport, Driving License
• Address Proof: Telephone Bill, Electricity Bill, Bank Statement With Cheque

FAQs on Indian Bank Fixed Deposit