A fixed deposit is a safe investment for risk-averse individuals since market risks are not affected. It is offered by banks as well as non-banking financial companies to their customers. You invest a lump sum amount of money for a fixed period at a predetermined rate of interest on the principal when you open a fixed deposit (FD). The entire amount of the principal and the interest income is returned to you at the end of the tenure.
Fixed Deposit booking is hassle-free. You only need your PAN and Aadhaar details. There are multiple options for interest payments and also auto-renewal options. You can also book your FD for 5 years and save tax.
How to Open FD Online?
If you are a new user, visit the website of the bank and register with a new ID.
If you already have an account, log in using existing credentials.
- Select ‘Deposit’ in the menu section.
- Click on ‘Fixed Deposits’ under the ‘Deposit’ section.
- Enter the necessary details like the amount of the fixed deposit, the tenure and the type of FD.
- Upload the required documents that are mandatory to open the Fixed Deposit.
- Complete the payment via net banking to Open FD online.
- You can download the receipt and take a printout.
The rate of the fixed deposit will determine the amount you will get at the end of the tenure.
The type of the fixed deposit, the frequency of interest earnings, and the tenure of the deposit will determine your fixed deposit interest rate. You can check out PNB housing FD interest rates by visiting the bank’s website. This can help you with a better understanding of fixed deposit interest rates.
Premature Withdrawal of FD Incurs a Penalty
Although it is possible to withdraw the FD prematurely, it might incur a penalty of 0.5% to 1% (especially for the tax saver FDs). Moreover, you also lose interest amount if you withdraw prematurely. You can easily stop the FD online. For e.g.: If you invest in an FD for 2 years, but withdraw at the end of the 1st year, the bank will recalculate your interest based on the interest rate applicable for the 1st year.
How to Prevent Premature Closure of the FD?
- You can ladder your deposit across different tenures if you divide your FD into parts instead of booking one lump sum FD for the long term. The best time to ladder your FD is when the interest rates start reversing.
- You can sweep in accounts so that there is no penalty on using funds whenever necessary. Moreover, there is no penalty on premature withdrawals (except for the tax saver).
- You can also avail of loans against fixed deposits from your bank instead of closing out the FD. The interest rate on a loan against the fixed deposit is typically 1-2% above the interest paid on the deposit. These loans have a lower rate of interest than personal loans since they are secured by the FD.
Steps to Close the FD Online
- If you still want to close the FD, visit the bank website and click on ‘Manage Accounts’.
- Under the ‘Open/ Close accounts’ section select ‘Premature Closure of FD’
- The FD account will be visible on the screen.
- Click ‘Submit’ to close the FD.
Opening a fixed deposit account online is hassle-free, all you need to know is the stepwise process. You can always do research and look for some attractive FD interest as offered by PNB housing FD interest rates.
They are attractive for senior citizens since they offer a special rate on deposits up to 1 crore. In case you face difficulty while trying to open an FD online, visit the nearest branch of your bank and get complete assistance from the staff there.
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