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IDBI Bank Fixed Deposit Rate

Fixed deposits are preferred investment avenue, given their simplicity and guarantee in terms of returns. A lump sum is parked for a pre-determined period for a guaranteed interest rate which will be calculated on a monthly or quarterly basis. The money cannot be withdrawn during the term which is called the lock-in period. If withdrawn due to pressing or unforeseen conditions, penalties are applicable. The maturity amount will be paid only after the term expires. The investor has the option of renewing the fixed deposit.

The deposits so received are used by the banks to lend to various customers. Fixed deposit term can range between 7 days to 10 years. Incase, the account holder is a minor then the term may be extended beyond the 10 year horizon to protect the best interest of the minor. These are typically considered on a case-to-case basis in banks. These basic features may vary from bank to bank, this is the mandate typically set by RBI and most banks’ policies are designed around the RBI mandate.

Fixed deposits to the extent of Rs. 1.5 Lakh with a lock-in of 5 years are eligible for tax benefit under section 80C of Income Tax Act, 1961. The minimum investment in fixed deposits is Rs. 100, there is no maximum limit that a bank stipulates for fixed deposits.

IDBI Bank Fixed Deposits

Idbi Bank Fixed Deposit Rate

IDBI Bank offers a host of products which are customized to match the needs of its vast clientele. They offer competitive rates and have a good brand recall. IDBI Bank’s fixed deposits were earlier termed as Suvidha Fixed deposit, it is now rechristened as Freedom Deposit. IDBI Bank offers fixed deposits which have always reflected the core principles of safety, credibility, attractive rates of interest and assured liquidity. Freedom deposit provides the highest interest rates in the industry, thereby ensuring that the investor gains the benefit of higher returns on investment.

Advantages of IDBI Bank’s Freedom Deposit

The key advantages of availing freedom deposit from IDBI Bank are –

  • Continuous and seamless access to fixed deposits with regular updates
  • Choice of term ranges between 15 days and 20 years for minimum deposits of Rs. 10,000
  • Competitive interest rates
  • Extra interest rate of 0.5% for senior citizens fixed deposit accounts with term of 1 year and above
  • No penalty applicable on premature withdrawal
  • Overdrafts available against deposits at attractive rates
  • Auto renewal facility
  • Various deposit options to suit customer’s needs

Key features of IDBI Bank Freedom Deposit

There are various options that are available to suit the requirements of various customers –

  • Monthly, quarterly and annual income plans for those who seek regular incomes –The interest income will be calculated as per the pre-determined period and will be credited automatically into the savings account or as indicated by the customer. The RBI mandate specifies that for intervals below quarterly, the simple interest rate calculation is applied. Monthly interest calculation is done at monthly discounted rate (simple interest method). The deposit automatically renews on maturity to ensure that the customer does not lose the opportunity to earn interest even for a single day. The minimum amount to open a fixed deposit account is Rs. 10,000.
  • Quarterly compounding ideal for availing higher interest rate – The quarterly compounding option ensures that the investor optimizes on the interest earned. The quarterly interest option uses the compound interest method of calculation. The effective yield is higher than the interest rate specified on an annual basis. For example if the interest rate for a 2 year + 1 day deposit is 5.8% p.a, the effective yield for the period of lock-in works out to be 6.11%, this is on account of re-investment of interest earned.
  • Sweep in savings – This option offers the flexibility of a savings account but higher interest rates as in the case of fixed deposit. A savings account can be opened and one can link multiple fixed deposits to the savings account. If the funds in the savings account are insufficient then the funds from fixed deposits can be transferred via debit card or cheque. The fixed deposit which is opened last will be broken first to ensure that the least amount of interest is lost.
  • Overdraft against Freedom Deposit – Easy overdraft facility is available against freedom deposit, this comes in handy for any urgent cash requirements. The overdraft does not amount to breaking the freedom deposit. An overdraft of upto 90% of the freedom deposit / multiple freedom deposit held with the bank is extended. The overdraft is given on freedom deposit earning least interest so that loss of interest is minimal.
  • Senior Citizens Freedom Deposits – A higher interest rate can be earned to the extent of 0.5% p.a for a term deposit of 1 year or more. The minimum amount of deposit allowed is Rs. 10,000.

IDBI Bank Suvidha Tax Saving Fixed Deposit

This is a tax saving scheme, wherein, the resident individuals and HUFs can avail this scheme and save their money on tax. Interest will be compounded on a quarterly basis, thereby optimizing on the interest earning capacity. Nomination facility available on all types of fixed deposit schemes offered by IDBI Bank including the tax saving fixed deposit. Interest on the deposit is liable to tax / TDS at 10.3%, the bank will deduct the tax on interest earned at the source. There is availability of auto renewal facility, on expiration of the period, in the case of tax saving fixed deposit, the period or tenure is 5 years, the matured amount will be auto renewed for the same tenure. Tax benefits on deposit under section 80C of Income Tax Act, 1961 can be availed to the extent of Rs. 1.5 Lakh deposited for a term of 5 years.

IDBI Bank Godhuli Retail Term Deposit

Senior citizens who are aged between 55 years and less than 60 can avail this fixed deposit scheme from IDBI Bank. The minimum amount for the deposit is Rs.10,000 and the maximum tenure is up to 20 years. The maximum amount can be deposited on this scheme is Rs.1 Crore. The advantage of the scheme is that the senior citizens can withdraw the amount before maturity and no penalty is levied.

Interest rate applicable on IDBI Bank Fixed Deposits

The interest rates offered by IDBI Bank on fixed deposits are competitive and attractive. The rates applicable are as mentioned below –

TenureFD RatesSenior Citizen FD Rates
15 days to 30 days5.75%5.75%
31 days to 45 days5.75%5.75%
46 days to 60 days6.25%6.25%
61 days to 90 days6.25%6.25%
91 days to 6 months6.25%6.25%
271 days to 364 days6.50%6.50%
6 months 1 day to 270 days6.50%6.50%
1 year7.00%7.50%
1 year 1 day to 3 years7.05%7.55%
3 years 1 day to 5 years6.85%7.35%
5 years 1 day to 10 years6.25%6.75%
10 years 1 day to 20 years6.00%6.50%

IDBI Bank Fixed Deposit Rate FAQ

1. Who is eligible to open a term deposit account with IDBI Bank?

Resident Indians, private or public limited company, Hindu undivided family, trust and partnership firm can open term deposit account with IDBI Bank.

2. What is the highest interest rate offered by IDBI Bank?

The maximum interest rate offered by IDBI Bank is 7.05% p.a for individuals, senior citizens are eligible for an additional 0.5% over and above the interest rate. Thus, the maximum interest rate offered by IDBI bank for senior citizens is 7.55% p.a.

3. What is the minimum amount allowed for opening a fixed deposit account?

Fixed deposit account can be opened with a minimum of Rs. 10,000.

4. What is the minimum and maximum tenure allowed on fixed deposits?

The tenure can range between 15 days and 20 years.

About IDBI Bank

IDBI Bank (Industrial Development Bank of India) was founded in the year 1964 by a Government mandate. The purpose of the bank’s establishment was to provide financial facilities for the development of Indian industry. The bank is owned by Government of India. The bank is one of the upcoming public sector banks in India and is treated on par with State Bank of India (SBI), however, IDBI Bank does not have the brand recall and pan India presence as is the case of SBI. The current Government holding is 85.96% stake in IDBI Bank. The bank operates with 1899 branches with one overseas branch in Dubai.

Idbi Bank Fixed Deposit Rate - Customer Reviews

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