SBI Annuity Deposit Scheme: How to get monthly income on a single deposit? | Rare Techy


In response to rising interest rates, the country’s largest lender, State Bank of India (SBI), is offering a scheme called the SBI Deposit Annuity Scheme, which is nothing more than an investment product where investors are required to make a lump sum deposit. park and can earn monthly installment payments that include a portion of the principal amount as well as interest.

Permission required

According to the official website of SBI, all residents, including minors, are eligible to apply for the scheme through single or joint method. Customers who are NRO or NRE are not eligible for this product, however, senior citizens are eligible to pay an additional interest rate over the regular rate. As per SBI guidelines, one can apply for SBI Annuity Scheme using savings, current, or OD account, and the account selected for the scheme should be a valid operating account enabled with Internet Banking and the account should not suspended, dormant, or confined.

Growth period and interest

The SBI Annuity Program is available at all SBI branches and comes in 36, 60, 84, or 120 months. For setting up an SBI Health Plan with a tenure of 3 to 10 years, a minimum deposit amount is required to be made for the annuity deposit, which is on a monthly basis of a minimum of Rs. 1000 for the valid period. As per SBI guidelines, the maximum deposit limit through online banking will be the same as the maximum limit specified for transferring funds into your account, but with offline mode, there is no maximum deposit limit. The rate of interest provided on the SBI Annuity Deposit Scheme will be applicable to term deposits for the period chosen by the account holder. On the SBI Annuity Scheme, the interest rate offered for SBI Time Deposits will be offered to the general public and senior citizens. SBI has increased interest rates on fixed deposits on June 14, 2022. SBI currently offers an interest rate of 5.45 percent to 5.50 percent to the general public and 5.95 percent to 6.30 percent to senior citizens on deposits maturing between 3 and 10 years. . . TDS will be applicable on interest paid on Annuity deposit and for this PAN needs to be submitted to avoid TDS payment.

Early withdrawal and redundancy facility

Premature withdrawal is permitted in the event of death of the depositor, and prepayment is permitted for deposits up to Rs. 15.00 lac, as per SBI terms and conditions. Premature withdrawals are subject to the same prepayment penalty as term deposits. As per current SBI early closing guidelines, for above term deposits 5.00 lac, the penalty charged will be 1% (all tenor) and 1% below the rate applicable at the time of deposit will be provided as early withdrawal charge for the period of deposit remaining with the bank. For special circumstances such as education, marriage, or other emergency, up to 75% additional cash/loan of the annuity balance can be granted. According to SBI, only after the OD/loan is disbursed, the annuity payment will be credited to the loan account.

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