Fixed Deposit Interest Rates

Documents Required To Open Fixed Deposit Account

Here is the list of must-have documents for opening a Fixed Deposit Account with the best FD rate of interest in India:

Particulars	List of Documents Required
Proof of Identity	Aadhaar card PAN card Driving license Voter ID card Government ID card
Address proof	Passport Electricity bill Utility bills Photo Ration Card
Savings Account Details to Link with FD Account	Bank Statement Cancelled cheque

Types of Fixed Deposit Interest Rates- India

The rates of interest on FD are of two types based on the flexibility of the FD Account and the FD Interest accumulation method.

FAQs on Fixed Deposit:

Q1. What is the minimum amount to open an FD account?

The minimum amount to open an FD account through mobile banking or net banking is ₹5,000.
The minimum amount to open an FD account through a bank branch is ₹10,000.

Q2. How is the interest on a Bank Fixed Deposit calculated?

Interest on FDs with a tenure of less than 6 months is calculated on simple interest.
Interest on FDs with a tenure of 6 months and above is calculated on compound interest. The interest is compounded quarterly, which means that the interest earned in the previous quarter is added to the principal amount for the next quarter's interest calculation.
For monthly interest payout, the interest is paid at a slightly higher rate than the standard rate. If the depositor has chosen to receive interest quarterly, the interest will be calculated and paid quarterly.

Q3. What happens to my Fixed Deposit if interest rate goes up or down?

The interest rate on your FD is fixed when you open the account. This means that even if interest rates go up or down after you open the account, you will continue to earn the interest rate that was applicable when you opened the account.

If you want to take advantage of the new interest rate, you will need to open a new FD.

Q4. Is Fixed Deposit taxable?

Yes, interest earned from FDs is taxable. TDS (Tax Deducted at Source) is deducted on interest earned if it exceeds ₹5,000 per annum. However, you can submit Form 15G/H to the bank or NBFC to avoid TDS deduction.

Q5. What is the minimum period for a fixed deposit?

The minimum period for a fixed deposit is 7 days.

Q6. Do banks charge a penalty for premature withdrawal of FD?

Yes, banks charge a penalty for premature withdrawal of FDs. The amount of the penalty depends on the tenure of the FD and the amount that is withdrawn.