Fixed deposits: SBI Multi Option Deposit Scheme vs HDFC Bank senior citizen special FD vs Punjab Bank FD

04/05/2024

When it comes to parking one’s hard-earned money into safe investment tools, fixed deposit schemes are still the most chased ones looking at the volatility in the market. As the Reserve Bank of India kept the repo rate at the same level, many banks have tweaked their fixed deposit rates to attract customers. In the last Monetary Policy Committee (MPC) meeting in April, the central bank decided to keep the policy repo rate unchanged at 6.5% as retail inflation continues to be above its target of 4%. This is the seventh meeting on the trot that the MPC maintained a status quo on the repo rate.

Here are the some of the fixed deposit schemes to look at:

SBI Multi Option Deposit Scheme or SBI MODS scheme is a fixed deposit (FD) or a term deposit scheme that is linked to the savings or current account of an individual. It offers 7 per cent interest to investors.

SBI’s Multi Option Deposit (MOD) Scheme offers a distinct advantage over traditional term deposits by allowing partial withdrawals. This feature enables account holders to continue earning interest at the prescribed rate on the remaining balance in their MOD account. The interest rate on the MOD account balance will remain the same as it was at the time of the first deposit.

The balance amount in MODS will continue to earn interest at the rate applicable at the time of initial deposit. The sum of available balance in the transactional account and MOD balance can be used for issuing cheques or withdrawal or making any other payment.

An SBI Multi Option Deposit Account can be opened either online through the SBI portal or in person at a branch.

Amount of Deposit

The minimum amount of investment in the scheme is Rs 10,000, and if further deposits are being made, they need to be multiplied by Rs 1,000. It is to be noted that the bank has not specified an upper limit on the amount that can be invested.

SBI MOD Balance Interest Rate

The scheme offers a minimum annual interest rate of 2.90%, with the potential to earn up to a maximum of 5.40% per annum, based on the deposited sum. Please note that the applicable interest rates will vary according to the duration of your deposit and the total amount invested.

Investment Tenure

The minimum period of investment for the scheme is one year, and the maximum tenure for MOD is five years.

Taxes on SBI MOD Interest Rates

The taxes can be deducted at the source when the interest earned on the deposit is known to be more than Rs. 10,000 during a financial year.

Maturity amount

The maturity amount is based on the tenor and type of a/c selected by you. You may enquire the maturity amount, maturity date and rate of interest, without opening e-TDR/e-STDR(MOD) through “Enquiry” tab available in e-TDR/e-STDR(MOD) page.

Premature closure of MOD a/c

For premature closure of MOD a/c, you may use ‘close a/c’ tab under e-TDR/e-STDR (MOD) link which will close your MOD account instantly if request is initiated between 08:00 AM IST and 08:00 PM IST. Request initiated beyond this period will be scheduled for next opening hours i.e. 08:00 AM IST. The maturity proceeds will automatically be transferred to your debit a/c from which MOD account was originally funded at the time of opening.

Renewability of the Scheme

The scheme cannot be renewed after a period of 5 years.

SBI MOD Interest Rates 2024

Interest Rates for 7 days – 45 days

General Customers: 3%

Senior Citizens: 3.50%

46 days – 179 days

General Customers: 4.50%

Senior Citizens: 5%

180 days – 210 days

General: 5.25%

Senior Citizens: 5.7%

211 days – 364 days

General: 5.75%

Senior citizens: 6.25%

1 year – 1 years 364 days

General: 6.80%

Senior citizens: 7.30%

2 years – 2 years 364 days

General: 7%

Seniors: 7.50%

3 years – less than 5 years

General: 6.50%

Seniors: 7%

5 years – 10 years

General: 6.50%

Seniors: 7.50%

HDFC Bank senior citizen special FD

Last month, HDFC Bank extended the last date to invest in its senior citizens-only special fixed deposit scheme to May 10. Launched in May 2020, the special Senior Citizen Care FD offers higher interest rate benefits for senior citizens.

According to the HDFC bank website, “Senior Citizens can enjoy a higher interest rate with HDFC Bank Senior Citizen Care FD. Apart from the existing premium of 0.5% over the regular FD rate, Senior Citizen Care FD provides an additional 0.25% over and above the 0.5% premium. The benefit of the above additional rate of 0.75% is applicable on the special offer between 18th May 2020 to 2nd May 2024. Further, this scheme is for those depositors who wish to deposit below Rs 5 crores.”

> Individuals can invest in Senior Citizen Care FD with a minimum amount of Rs 5000 and a maximum amount of Rs 4,99,99,999.99 (i.e., less than Rs 5 crores).

> Individuals can invest in Senior Citizen Care FD for a minimum tenure of 5 years and 1 day and a maximum tenure of 120 months.

> Interest rates

<2 Cr. Deposit: Tenure: 5 years to 10 year, Interest rate for senior citizens: 7.75%

>= ₹2 Cr. to < ₹5 Cr. Deposit: Tenure: 5 years to 10 year, Interest rate for senior citizens: 7.75%

Premature closure

If someone opts to prematurely close this special senior citizen FD (including sweep in / partial closure), the interest rate will decline.

> If the deposit is closed prematurely on or before 5 years, the interest rate will be 1.00% lower than the rate on the date of booking, for the time during which the deposit was held by the bank.

> If a Fixed Deposit is prematurely closed after 5 years, the interest rate will be 1.25% lower than the rate on the date of deposit booking, for the time during which the deposit was with the bank.

Punjab National Bank FD

Punjab National Bank (PNB) revised FD interest rates on deposits below Rs 2 crore. The new rates are effective from April 12, 2024. The bank is offering FD interest rates between 3.50% to 7.25% for regular citizens, while for senior citizens, the bank is offering interest rates between 4% to 7.75%. For super senior citizens, the interest rates are between 4.30% and 8.05%.

The bank classifies senior Citizens as investors aged 60 years and up to < 80 Years. Super Senior Citizens are investors age 80 years and above.

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