SBI Fixed Deposit vs Savings Bank Account vs Savings Plus vs Recurring Deposit vs Holiday Savings: Benefits explained
State Bank of India (SBI) is India's largest public lender. It provides different types of accounts where customers can save and grow their hard-earned money.
State Bank of India (SBI) is India's largest public lender. It provides different types of accounts where customers can save and grow their hard-earned money. Headquarters in Mumbai, SBI is the biggest financial services conglomerate in India. The bank provides a wide range of products and services to individuals, institutions, corporated and various public, or private, bodies. Here we take a look at the benefits and features of SBI SBI Fixed Deposit accounts, Savings Bank Account, Saving Plus account, Recurring Deposit account, and Holiday Savings account.
SBI Fixed Deposit
SBI offers several term/fixed deposit plans in which customers can invest for a tenure of 7-10 years. The minimum amount that needs to be invested in the term deposit is Rs 1000. The bank recently hiked interest rates on FDs. Senior citizens get 0.25% extra for amount above Rs 10,000.
SBI FD interest rate:
SBI Savings Bank Account
Any person fulfilling account opening requirements can open a Savings Bank Account. You an chose to open the Savings Bank account with or with cheque book facility. Under exceptional circumstances, the bank also allows overdrafts. The official SBI website says, "Overdrafts in Savings Bank accounts may be permitted under exceptional circumstances with prior arrangements only." The interest rates on SBI savings account deposit are:
SBI Saving Plus account
The SBI Savings Plus Account is a Savings Bank Account linked to MODS. In this account, the fund above a threshold limit from the Savings Bank Account is transferred automatically to Term Deposits opened in multiples of Rs. 1000. Any individual eligible to open Savings bank account can open the Savings Plus account. The minimum threshold limit for transfer to MOD is Rs 35,000. The rate of interest is the same as the Savings Account. The minimum amount of transfer to MOD is Rs 10,000 in multiples of Rs 1000 at one instance.
SBI Recurring Deposit account
Recurring Deposit provides an opportunity to increase saving through regular monthly deposits of fixed sum over a period of time. In SBI RD accounts, a customer can make a monthly deposit of minimum Rs.100 and in multiples of Rs 10. There is no limit on the maximum amount. The minimum period for which one needs to put money in RD account is 12 months and maximum 120 months. RD rate of interest is the same as Fixed Deposit rate. A loan/overdraft up to 90 per cent is available against the balance in RD account. TDS is applicable on the RD. Premature withdrawal is also allowed.
Penalty charges for non-Deposit of monthly installments:
- For account of period 5 years and less: Rs 1.50 per Rs. 100 per month
- For a/c of period above 5 years: Rs. 2.00 per Rs. 100 per month.
SBI Holiday Savings account
SBI in association with Thomas Cook India this savings plan for holiday goers. Under the scheme, a customer can save monthly amounts in the form of a recurring deposit with the Bank in order to avail a vacation package listed under Holiday Savings Account packages on Thomas Cook website.
How SBI Holiday Savings account function:
- First, visit the Thomas Cook HSA website and choose a package of your choice.
- The cost of the package chosen by the customer is divided by 13.
- The customer is redirected to the OnlineSBI portal where s/he can set up an e-Recurring Deposit (e-RD) account for 12 monthly installments. The e-RD earns earn interest as per the prevailing interest rates for the 12 month period.
Watch this Zee Business video
- After the end of 12 months, the maturity proceeds are transferred to Thomas Cook to pay for the pre-selected holiday package.
- Thomas Cook funds the balance amount, that is the 13th installment to purchase the package after factoring in the accrued e-RD interest.