At times, you may consider liquidating your fixed deposit to accommodate an unanticipated emergency. However, this results in losing out on the interest income you may have received after its maturity.
Although, you can still tend to your emergency expenses without breaking your FD investment by taking a loan against your fixed deposit. A loan against FD is a secured loan where your FD acts as collateral in return for your loan amount.
State Bank of India also offers such loans against FD for its customers. With a loan against an SBI fixed deposit, investors can meet their expenses without liquidating their FDs. Another exciting aspect of an SBI loan against FD is that its rate of interest is lower than other kinds of loans that are present in the financial sector.
Given below are the features of an SBI loan against FD and other essential details.
Fixed Deposit Type
Applicable Interest Rates
Loan against regular fixed deposits
1% over the FD interest rate
Loan against NRO fixed deposits
1% over the FD interest rate
Loan against NRE fixed deposits
1% over the FD interest rate
Loan against FCNR (B) deposits
2.90% over the 1 year-MCLR mark
Disclaimer: Note that the current Marginal Cost of Funds Based lending Rate (MCRL) is fixed at 8.30%.
Here are a few advantages of availing a loan on SBI FD:
Loan amount of up to 95% of your total FD value
Can get a demand loan or an overdraft against SBI FD, depending on your needs
Interest rate charged at 1% above the prevailing FD rate
Zero loan processing charges with nil prepayment penalties
Fixed repayment tenure based on your repayment capacity
Minimum loan amount of ₹5,000 for availing an online overdraft facility
Maximum amount of up to ₹5 Crores sanctioned for an online overdraft loan
Can earn interest on your existing fixed deposit used for the loan
When availing an SBI loan against FD, ensure that you meet the following eligibility parameters:
You need to have a fixed deposit account with SBI
You must be at least 21 years to avail an SBI loan against FD
All sole proprietorship and partnership firms can avail an overdraft against SBI FD
The FD against which you apply for a loan should not have matured when availing a loan
If you hold RD or FCNR deposits, you are still eligible to apply for an FD
The repayment time is the period during which you must complete your loan repayment. Like other credit facilities, you have to follow a fixed repayment period when availing an SBI loan against FD.
However, SBI proposes the repayment schedule after properly analysing your financial standing. This helps reduce the burden on your monthly budget.
So, when availing a special SBI term deposit online or offline, you need to repay the loan within a maximum period of 5 years. However, in the case of a regular term deposit booked online or offline, there is a repayment tenor of 3 years.
Knowing the repayment options before availing a loan on SBI FD helps you manage and plan your finances efficiently.
When availing a loan or overdraft against SBI FDs, the minimum loan amount disbursed is ₹5,000. Note that you can avail a maximum loan amount of up to ₹5 Crores when pledging your fixed deposit as collateral.
Another interesting feature of availing a loan against SBI fixed deposits is that you can get up to 95% of the total FD amount as the loan. With all the unique features and minimal documentation, getting a loan against SBI FDs is easy and quick.
Follow the process mentioned below to avail a loan against SBI FDs:
Log in to the SBI net banking portal with your credentials
Navigate to the e-fixed deposit section
Select the ‘Overdraft Against Fixed Deposit’ tab
View the list of FDs booked with SBI
Choose a specific FD from the list
Click on the ‘Proceed’ tab
Check the details such as overdraft amount, applicable interest rate, etc.
Tap on the ‘Submit’ button
Key in the password sent to your mobile number
That’s all it takes to open your loan account. So, follow these easy steps from the comfort of your home and avail a loan against SBI FD in no time! You can get more details regarding the process on Bajaj Markets.
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You can get a loan amount of up to 95% of your total FD value from SBI.
Yes, the bank pledges your FD as collateral for the loan amount you avail.
Yes, compared to other credit facilities, a loan against SBI FDs is a reliable option as you are charged low interest rates. Moreover, you also get an adequate amount with a flexible repayment schedule when availing a loan against FD.
Yes, as long as the NRI fixed deposits are active, you can avail a loan if you are an NRI customer.
You can get up to 95% of your total FD value as a loan from SBI.