- Step 1: Visit the bank branch and get a form for premature withdrawal.
- Step 2: Fill the form with necessary details such as name, bank account details, and FD number among others.
- Step 3: Submit the document with the bank and they will process your request.
- Step 4: Once the FD is closed, the funds will be credited to your savings account.
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Steps to close an SBI FD online before maturity
- Step 1: Visit SBI's website and click on the Fixed Deposit tab.
- Step 2: Click on the ETDR/STDR (FD) tab under the Fixed Deposit tab.
- Step 3: Click on the Close A/C Prematurely' tab.
- Step 4: Your FDs will be listed in this section.
- Step 5: Select the FD you want to close and click on the proceed button.
- Step 6: Verify your FD detail such as amount, date of maturity and so on.
- Step 7: Mention the reason for closing the FD in the 'Remarks' section and click on the 'confirm' tab.
- Step 8: You will now receive a 'high security password' on your registered mobile number.
- Step 9: Enter the 'high security password' and click on the 'confirm' tab.
- Step 10: You will receive a message confirming that the FD has been closed.
- Step 11: The FD amount will be credited to your savings account.
Note: If you want an instant closure, you need to initiate the FD closure request between 08:00 AM IST to 08:00 PM IST on the SBI website. A closure request post 08:00 PM will be taken into consideration for the next working day.
Visit this link to know more about - How to Close SBI Fixed Deposit Online/Offline
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Steps to close HDFC FD Online Before Maturity
- Step 1: Visit the HDFC website and login to your NetBanking account with your Customer ID and IPIN (NetBanking Password).
- Step 2: Click on the Fixed Deposit tab from the Menu bar situated on the left side of the page.
- Step 3: Select the 'Liquidate Fixed Deposit " option under the Fixed Deposit tab.
- Step 4: You will see a list of your fixed deposits in this section.
- Step 5: Select the FD account number you want to closet from the FD lists.
- Step 6: Click on "Continue" and "Confirm" the details entered.
- Step 7: You will be sent to a page that will confirm closing of your fixed deposit.
Note: This facility is available to Fixed Deposits held under "Sole Owner (SOW)" relationship only.
Visit this link to know more about -How to Close HDFC Fixed Deposit Online/Offline
Steps to Close an FD on Maturity
Once you close an FD after on maturity, you will need to submit the deposit certificate. You could also be asked to submit a signed form indicating that the FD may be closed on the maturity date. The fixed deposit amount including the interest will be transferred to your savings account on maturity. You can renew or close the FD on the maturity date via online.
FD Closure on Maturity
If the maturity period of your FD is over and you have not taken any action, bank will have two ways to deal with your matured FD.
Auto Renewal
The bank may renew the FD automatically for one year or for the original term of the FD on the due date.
Auto Liquidation
The FD will get liquidated on the due date and the bank will transfer the proceeds to your savings account.
Note: You should read the terms and conditions on the deposit certificate to learn about the treatment your Fixed Deposit will receive on maturity.
How to Minimise Unplanned Deposit Closure?
Most of us break our FDs prematurely, in an unplanned manner, to meet are sudden financial goals. This will cost you dearly and you will not be able to get the maximum returns out of the term deposit. Though the penalty amount may look small, when it is calculated, it does cause a certain sizable loss.
Formulae for Calculating Interest Rates for Premature Closure:
- There are many banks that do not levy a penalty for premature withdrawal. Invest in a bank that has this facility.
- Take a loan on the deposit, instead of closing the deposit prematurely. Instead of breaking the FD account, you can always take a loan/overdraft against the term deposit. Most banks allow customers to take a loan of up to 90% on the deposit amount.
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How to Close Other Banks' FD
- How to Close SBI FD
- How to Close HDFC FD
- How to Close Axis Bank FD
- How to Close Indusind Bank FD
- How to Close CitiBank FD
- How to Close RBL Bank FD
- How to Close SC FD
- How to Close Yes Bank FD
- How to Close HSBC FD
- How to Close Kotak Mahindra FD
- How to Close PNB FD
- How to Close Canara Bank FD
- How to Close Andhra Bank FD
- How to Close IDBI FD
- How to Close Bank Of Baroda FD
- How to Close Bank of India FD
- How to Close Bank of Maharashtra FD
- How to Close Union Bank FD
- How to Close Indian Bank FD
- How to Close KVB FD
- How to Close Lakshmi Vilas Bank FD
- How to Close Federal Bank FD
- How to Close Central Bank of India FD
- How to Close TMB FD
- How to Close IDFC FD
What are the penalty charges for premature closure of FD?Penalty will be a certain percentage of the interest amount earned. This percentage charged will vary from bank to bank.
Can you close an FD online if it was not opened online?Generally, if the FD was not opened online, it may not reflect in your net banking account. Although, with some banks the FD can be closed online even if it was not opened online. However, you can request your customer care to help you with the online closure.
Are there penalty charges for premature closure of FD?Yes. Banks usually levy a certain penalty amount for withdrawing the FD account prematurely. The penalty amount may differ from bank to bank and the type of deposit held
Can the FD account be broken without any penalty?Generally, banks charge a penalty for breaking FD, however, there are some banks that do not charge a penalty. It should be noted that if you have held the deposit for 7 days, most banks will not charge a penalty.
Can I withdraw the account prematurely if there is a specified lock-in period ?No, this will not be possible.
Can I break my tax-saver FD, which comes with a lock in period of 5 years?No. Any type of tax-saver FD cannot be withdrawn prematurely.
Should NRIs who return back to India close their NRO, NRE FD?Yes. NRIs who return back and lose their NRI status can ideally close their FDs and make other investments.
In case of a joint account, is there a need to obtain the signature of all account holders?Yes. You need to take a signature of the joint account holder to close the FD.
FAQs
Fixed deposits, with a premature withdrawal facility, allow the depositor to close the FD before the date of maturity arrives. This comes as a relief in times of cash crunch. However, a certain amount may be required to be paid by the depositor as a penalty to the bank. This usually ranges between 0.5% and 1%.
Can I close my FD account before maturity? ›
Fixed deposits, with a premature withdrawal facility, allow the depositor to close the FD before the date of maturity arrives. This comes as a relief in times of cash crunch. However, a certain amount may be required to be paid by the depositor as a penalty to the bank. This usually ranges between 0.5% and 1%.
Which FD should break first? ›
While it may seem like an obvious choice to break your old FD which has lower interest rates and invest in a newer FD which offers higher rates, you should first calculate how much money you will lose through the closure penalty as well as the reduction in your original interest rate.
Is it advisable to break FD for a higher interest rate? ›
Not necessarily. While higher interest rates can offer better returns, the penalty for premature withdrawal and the loss of interest on the old FD must be considered. Calculate the net gain to determine if breaking the FD is profitable.
How do I write a letter to the bank for closing a fixed deposit before maturity? ›
Dear Sir/Ma'am,
My FD will mature on 27/7/2025 (write the closure date in the same format). I would like to request you to close my FD account prematurely because I need emergency money for a medical treatment of a family member (write your reason).
How much amount is deducted on premature closure of FD? ›
Penalty - If you wish to take your FD out before it matures, you will have to pay a penalty. As a penalty, a bank typically levies 0.50% to 1.00% of the interest. The bank reserves the right to alter the applicable penalty.
Can I close a fixed account early? ›
Normally, you can't withdraw money or close your Fixed Rate Savings Bond during its term.
What documents are required to break FD? ›
Make sure you enter the requested details such as your FD number, your name, bank account details and so on. Submit this form with ID proof, such as a photocopy of your PAN card, after which your FD will end.
What are the disadvantages of breaking FD? ›
The amount received from premature withdrawal is much less than the interest earned if invested elsewhere. According to the Reserve Bank of India, banks are allowed to charge penalties in case of premature withdrawal of FD. Therefore most bank charges a penalty from 0.50% to 1.00% of the interest causing a great loss.
Is it better to have multiple FD or single FD? ›
Diversifying across smaller FDs mitigates risk, as difficulties faced by one institution won't affect your entire investment. On the other hand, if you have large fund requirements and you are aiming to park your money in a secure investment instrument for the future then one single FD can also be suitable.
If your interest income from all FDs with a bank is less than Rs. 40,000 in a year, the bank cannot deduct any TDS. The limit is Rs. 50,000 in the case of a senior citizen aged 60 years and above.
What are the new RBI guidelines for premature withdrawal of fixed deposits? ›
The Reserve Bank of India (RBI) on October 26, 2023, has increased the minimum amount for offering non-callable term deposits to Rs 1 crore from the existing Rs 15 lakh for banks. So, all customers will get an option to prematurely withdraw money from fixed deposits (FDs) of up to Rs 1 crore.
What gives better returns than FD? ›
Government Bonds
The government issues these bonds at an interest rate that is higher than what fixed deposits offer. Investors can choose between short-term or long-term bonds depending on their investment goals and needs.
Can I close my fixed deposit online? ›
Closing a Fixed Deposit (FD) is a simple process and can be done online as well as by visiting the bank branch. You can close an FD before maturity and after maturity. The process of closing the FD by visiting the branch is same for most of the banks.
What is the procedure for closing a fixed deposit account on maturity? ›
Visit the bank and submit the fixed deposit certificate with all the necessary signatures of the account holders. You will be asked for further instructions - whether you want to close the FD, renew it, move the funds into a new FD/investment or withdraw some of the funds and leave the rest in the FD.
What happens to fixed deposit if bank closes? ›
As per the norm, each depositor is insured for up to Rs 1 Lakh for Savings, Fixed, Current and Recurring Deposits and this includes both the principle and the interest amount accrued. Whether it be Public, Private, Co-operative or Foreign Banks (with branches in India), all of them are covered by the Deposit Insurance.
What happens if we close recurring deposit before maturity? ›
The penalty for breaking RD before maturity varies depending on the institution. Most banks and financial institutions levy a penalty for premature withdrawal of RD, ranging from 0.5% to 1%, depending on the period remaining until maturity.
What if I break my FD before maturity in SBI? ›
Yes, there is a premature withdrawal penalty for SBI FD accounts. For term deposits less than Rs. 5 lakh, the premature withdrawal penalty is 0.50% while for term deposits above Rs. 5 lakh, the premature withdrawal penalty is 1%.
Can I withdraw my FD before maturity in federal bank? ›
The bank will at times allow premature withdrawal of a term deposit before its completion and will levy a penalty. The bank will pay the rate for the term deposit remained, after it has deducted 1%. 1% will be levied for preclosure including deposits that are closed for reinvestment.
What happens if I break my FD before maturity in Indian bank? ›
For premature closure of Indian Bank FD, the bank charges a penalty of 1.00% of the total liable amount of the depositors FD account.
