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New Delhi43 minutes ago
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If you are also facing money problem due to Corona Crisis, then your Fixed Deposit (FD) can get you out of this problem. You can withdraw money before the time if needed. However, some penalty has to be paid on this as well. Apart from this, you can also overcome your problem by taking a loan on FD. We are telling you which option will be right for you.
Get FD easily and at low interest
If you take a loan on FD, you will have to pay 1-2% more than the interest you get on a fixed deposit. For example, if you are getting 4% interest on your FD, then you can get a loan at 6% interest rate. You can take a loan up to 90% of the value of FD. Suppose your FD is worth 1.5 lakh rupees, then you can get a loan of 1 lakh 35 thousand rupees.
Many banks including SBI, the country’s largest bank, also provide online facility for this. Apart from this, you can also take a loan by going to the bank. This loan is a secured loan and hence it is easily available.
What rate of interest is the bank giving the loan
|Bank||Loan interest rate (%)||Maximum loan|
|SBI||FD rate + 1%||Up to 90% of FD|
|Punjab National Bank||FD rate + 1%||Up to 95% of FD|
|Axis Bank||FD rate + 2%||Up to 85% of FD|
|HDFC Bank||FD rate + 2%||Up to 90% of FD|
|Bank of baroda||FD rate + 2%||Up to 90% of FD|
|FD rate + 2%||Up to 90% of FD|
|ICICI Bank||FD rate + 2-3%||Up to 90% of FD|
How much interest will be reduced for prematurely breaking FD?
If you are breaking FD ahead of time, then you do not get interest at the rate at which you have FD. For example, suppose you made a FD of Rs 1 lakh at the rate of 6% for 1 year, but you break it only after 6 months and interest is getting at the rate of 5% per annum on a 6-month FD, so In the bank, the interest will be paid on your money at the rate of 5% and not at the rate of 6%.
Penalty will also have to be given: According to the rule of the country’s largest bank SBI, if a person makes an FD of up to Rs 5 lakh, then he will have to pay a penalty of 0.50% on breaking it before the FD matures. Similarly, 1% penalty on FDs of more than Rs 5 lakh and less than Rs 1 crore will have to be paid if they break before time. After ensuring the interest according to the period (as mentioned above) you are paid your money by deducting 0.50 or 1% interest according to the FD amount. Most banks charge a penalty of up to 1%.
For example, if you make 1 lakh FD for 1 year, on which you have to get 6% per annum interest. In such a situation, on completion of one year you will get 106,167 rupees. On the other hand, if you withdraw money after 6 months, you will get interest at the rate of 5%, besides a penalty of 0.50%. In such a situation, you will get a total of 102,469 rupees after withdrawing money after 6 months.
Which option will be right?
If your FD is 1 lakh rupees and you need 50 thousand rupees, then it will be right to take a loan on your FD. Because this will save your savings and your money needs will also be fulfilled. On the other hand, if you need the entire amount of FD, then it would be right to break FD before your time because it will get your money after a little penalty. On FD, 80 to 90% of the money is available in the form of loan.