Fixed deposits are a popular investment option for most investors because of the reliable returns and minimal risk they promise. For the best FD returns, people browse the market and compare the available options before settling on the right one. Upon opening their FD account, they are handed a statement of acknowledgement from the bank. This document is known as Fixed Deposit Receipt (FDR) or Fixed Deposit Advice (FDA). This document contains details pertinent to the FD account, and acts as proof of the investment. Read on to know more about how FD advice works.
The bank provides a computer-generated statement that acts as a proof of ownership or investment when you open a FD. This document is the FD Advice. Here is the information contained in the document:
Linked Savings Account
Tenure/Duration of FD
Terms and Conditions
Details about auto-closure, auto-renewal
Nominations (if any)
Investors who wish to get the best FD returns from their investment scheme, need to be aware of essentials such as the FD Advice. Without this information in hand, you may not be able to provide proof of acknowledgement as and when needed. The primary difference between the FD Advice and FD Receipt is that the former is not printed on security, it is printed on normal paper. Other than that, all the information presented in the FDR is replicated in the FD Advice.
Since the FD Advice is computer-generated, it does not require bank officials to sign off on it.
FD Advice can also be sent directly to the customer’s registered email ID
In case you lose the FD receipt, you will be expected to give an indemnity bond for a duplicate receipt.
You do not need to provide an indemnity bond to get duplicate FD Advice; you can simply apply for one through the bank branch.
Remember, it is the bank’s responsibility to send you the FD advice. It is your duty as an investor to ensure that you have these necessary documents in order. If you don’t receive it even after the stipulated period has passed, you can contact their helpline to place a request. Every investor has the right to insist on the FD Advice as it is vitally important.
The FD Receipt is printed on security paper and carries the signature of an authorized bank official. Customers are also required to return it at the time of maturity payment or FD renewal. However, in case of the FD Advice, the account can be renewed without the advice being taken back.
For loans, investors can pledge the FDR to take out a loan, but they cannot use the FD Advice to do the same.
While the Government accepts signed FD Receipts as security, the same does not apply to FD Advice, signed or not. Hence, the FD Advice acts as an intimation for the customer and cannot be used as an assignable paper.
The form that is prescribed includes a particular clause that asks for indemnity from the investor to guard against the potential fraudulent use of the account. However, the investor may not be aware of this condition at the time of booking the account or may not be explicitly informed.
The FD Receipt is not transferable and a valid pledge cannot be made with it without the bank’s permission. In comparison, it is easier to create duplicates of the FD Advice which leaves the investor more vulnerable to fraud. This can be done via mobile devices also, and since it is on unsecured paper and is unsigned, physical copies can also be made easily.
Keeping all this in mind, investors and customers should be aware that the FD Receipt is more secure in comparison to the FD Advice, as the FDR cannot be used as approval for any action without the investor’s or bank’s explicit consent. The FD Advice’s main purpose is a convenience for customers, but it may not be the safest option.
The FD Advice is a document that is not just handy, but is essential for any investor who needs to keep track of their account details. Every investor wants to protect their investments and get the best FD returns, while still ensuring safety of their funds. Hence, make sure to safeguard your documents properly and procure them in intact condition as and when needed.
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FD is considered a safe investment as it involves low risk and offers considerable and reliable returns.