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Fixed Deposit

Indian Overseas Bank offers three types of Fixed Deposit accounts to cater to the requirement of every type of individual be it for a short term or a long-term tenure. The types of deposits available via Indian Overseas Bank are a standard Fixed Deposit account, a Tax Saver Deposit Scheme and a Floating Rate Deposit account. The customer can choose which type of deposit he or she requires as well as the tenure, by assessing their needs and preferences.
 

Indian Overseas Bank offers attractive and competitive rates of interest that ensure the maximization of returns on the savings of the depositors that are held with the bank. As the bank offers flexibility in payout options and tenures, the Fixed Deposit accounts offered by them are very attractive for customers and allows for optimal trade-offs between liquidity and returns.
 

IOB FD Rates 2018

FD Tenure

Interest rate (in %)

Regular Citizens Senior Citizens
7 days – 14 days 4.00 4.50
15 days – 29 days 4.00 4.50
30 days – 45 days 4.00 4.50
46 days – 60 days 4.00 4.50
61 days – 90 days 4.50 5.00
91 days – 120 days 5.00 5.50
121 days – 179 days 5.00 5.50
180 days – 269 days 5.75 6.25
270 days -< 1 year 6.25 6.75
1 year only 6.75 7.25
>1 year – < 2 years 6.50 7.00
2 years to 3 years 6.25 6.75
> 3 years – < 5 years 6.00 6.50
5 years & above  6.00 6.50

*Minimum amount should be Rs 1 Lakh.

Note: Interest rates applicable w.e.f. 15 June 2017 on deposits below Rs 1 Crore are liable to change without prior information.

Types of Indian Overseas Bank FD Accounts

  1. IOB Regular Fixed Deposit
  2. IOB Tax Saver Fixed Deposit Account
  3. IOB Floating Rate Deposit

IOB Regular Fixed Deposit

In this standard Fixed Deposit account the customer submits a lump-sum amount with IOB for a stipulated amount of time. This lump-sum amount garners interest in that period. This deposit scheme may be held for a short or long timeframe as per the customers’ choice. With this fixed deposit account, the customer gets the double benefit of earnings as well as flexibility in handling the account.
 

Deposit Amount

Minimum Rs.1000

Tenure

6 months to 120 months (10 years)


Thus, this Fixed Deposit account can be opened for as low and affordable sum of Rs. 1000 simply by visiting the nearest branch and filling in the application form and providing the necessary identity/address proofs.
 

Who is eligible?
 

  • Resident of India
  • Professional & Self-employed
  • A small trader
  • A salaried individual
  • A rural saver
  • Hindu Undivided Family

Tax Deductions under the Re-investment Scheme: When the interest rates on a Fixed Deposits in a single year equal or exceed Rs. 5000 then Indian Overseas Bank will deduct a TDS of 10% on the total interest if PAN details have been provided to the bank. In case, however, the customer has not provided any PAN details to IOB, then the bank will deduct a TDS of 20% on the total interest. The customer will be provided with the TDS certificate mentioning the details of the tax deduction. The customer will have to submit a Form 15G or Form 15H on March 31st. TDS rates are given below:
 

 

Tax Rate

Surcharge

Education Cess

Total

Resident Individuals, Hindu Undivided Family

10%

-

-

10%

Added Features-
 

  • Loan against Indian Overseas Bank Fixed Deposit:

This is a unique facility not available with other banks. Indian Overseas Bank allows its customers to avail of a loan of up to 90% of the deposit. The applicable rate of interest on this loan against the Fixed Deposit is typically 0.5% to 2% above the fixed deposit rate. Thus, the bank customers who avail of the Fixed Deposit account get multiple benefits in that not only are they saving money and garnering interest on that amount, they may also avail of a loan if and whenever required. This helps in ensuring that the customers are never at a loss when it comes to money.
 

  • Pre-closure of Fixed Deposit:

Customers are permitted to pre-close their Fixed Deposit accounts to withdraw the funds there, if they so require. It is to be noted, however, that in case of a pre-closure or premature withdrawal, Indian Overseas Bank will pay a rate of interest that is 1% lower than the rate that is usually applied for the actual duration of the deposit.
 

  • Nomination facility:

Customers of Indian Overseas Bank are allowed to nominate a person in their Fixed Deposit account. The process is simple, they only need to submit the duly filled and signed nomination form to the nearest Indian Overseas Bank branch.

IOB Tax Saver Fixed Deposit Account

This scheme is ideal for those customers who are looking to save on tax by investing in funds in a fixed deposit. Tax exemption for these deposits is permitted as per the Income Tax Act under Section 80C.
 

Deposit Amount

Rs.10000 – Rs.1.5 lakhs

Tenure

5 – 10 years years

Who is eligible?

In order to be eligible to open a Tax Saver Fixed Deposit account with Indian Overseas Bank the customer has to be any one of the following entities –
 

  • Resident of India
  • A salaried individual
  • A small trader
  • Professional & Self-employed
  • A rural saver
  • Hindu Undivided Family
Tax Deductions under the Re-investment Scheme:
 

When the interest rates on a Fixed Deposits in a single year equals or exceeds Rs. 5000 then Indian Overseas Bank  will deduct a TDS of 10% on the total interest if PAN details have been provided to the bank. In case, however, the customer has not provided any PAN details to IOB, then the bank will deduct a TDS of 20% on the total interest.  The customer will be provided with the TDS certificate mentioning the details of the tax deduction.  The customer will have to submit a Form 15G or Form 15H on March 31st. TDS rates are given below:
 

 

Tax Rate

Surcharge

Education Cess

Total

Resident Indians and Hindu Undivided Family

10%

-

-

10%

Added Features-
 

  • Transfer of Deposit-

Customers of Indian Overseas Bank may transfer their deposit between branches of the bank, if they so wish. However, transfer between banks is not permitted. This means that while the customer may transfer their Fixed Deposit account between branches of the Indian Overseas Bank; say if there is a branch that is closer to their home or office, they may wish to transfer their deposit to that branch, as it will be more convenient. Even for example, in case the customer moves to a different city, they may wish to transfer their Fixed Deposit account to an Indian Overseas bank branch in their new location.
 

  • Holder of the Deposit-

The deposit may be held in a single name of a depositor or it may also be held in the joint names of two individuals.  An adult along with a minor may also jointly hold the deposit account. These joint accounts are payable to either or survivor. For tax saving, the tax benefit can be claimed only by the first named depositor.
 

  • Repayment of Deposit-

The deposit will be repaid on or after the maturity date as per the normal process. In this scheme, pre-closure or premature withdrawal of the deposit is not allowed until five years has been completed from the date of deposit.
 

  • Nomination-

As per bank rules, customers can make nominations for the deposits. However, in the case of deposits that are held by or on behalf of a minor, nominations are not accepted by the bank.

IOB Floating Rate Deposit

This deposit account type is a variation on the regular fixed deposit type. In this the interest rates that are offered are floating instead of fixed, the rates are reset every six months in a year. The rates are reset on the 1st of March and the 1st of September of every year, regardless of when the deposit was made by the customer.
 

Deposit Amount

Rs.1 lakh – no fixed upper limit

Tenure

3 years – 10 years

 

Interest Rates-

The deposits received under the Floating Rate Deposit scheme receive interest rates as per the following:
 

Interest Rate

Tenure

5 years G Sec rate (daily average for the past 6 months)

3 years to 5 years

10 years G Sec rate (daily average for the past 6 months)

5 years to 10 years

 

Who is eligible?

The following are eligible for opening a Recurring Deposit Account:
 

  • Resident Indians
  • Hindu Undivided Family
  • Private & Public Limited Companies
  • Trusts & Societies

Added Features-
 

  • Loan against Indian Overseas Bank Fixed Deposit:

  • Indian Overseas Bank allows its customers to avail of a loan of up to 90% of the deposit. The applicable rate of interest on this loan against the Fixed Deposit is typically 0.5% to 2% above the fixed deposit rate.
  • The fixed deposit has a lock-in period of 3 years from the date of deposit.
  • Pre-closure of Fixed Deposit:

As per bank guidelines, the customer may break his or her FD and withdraw their money, subject to the condition that the deposit has completed three years from the date of first deposit. A notice of at least ten days has to be given by the customer to the bank requesting the pre-closure. There will be a foreclosure charge of 1.00%, which is deducted from the applicable interest payable on the deposit.
 

  • The minimum tenure for the deposit is 3 years, while the maximum is 10 years.
  • The minimum deposit accepted by the Indian Overseas Bank for this scheme is Rs.1 lakh and thereafter is multiple of Rs.10, 000. There is no upper ceiling limit on this scheme.
  • As with the regular Fixed Deposit account, TDS is deducted if the total interest exceeds Rs.5, 000 in a year.
  • The interest on the deposit is paid on a quarterly basis on the first working day of January, April, June and September.
  • The customer has an option of converting their existing regular Fixed Deposit (fixed interest rate deposit) to a Floating Rate Deposit. This can be done by closing the deposit prematurely and then opening a Floating Rate Deposit. In this case, the interest rate on the prematurely closed Fixed Deposit will be paid at the appropriate rate for the period the deposit has remained with the bank and there will be no foreclosure charges deducted. It should be noted that it is not permitted for a Floating Rate Deposit to be converted to a regular Fixed Deposit (Fixed Interest Rate Deposit).
  • Floating Rate Deposit Scheme is only available at Totally Automated branches of the Indian Overseas Bank.