Once money has been invested in a fixed deposit, it is pretty much inaccessible to the depositor, unless they go in for a premature withdrawal. But what happens if the need is great but not too big in terms of the amount needed. Would it really make sense to break a big deposit for a few thousand rupees? This is the ideal situation that a MOD, or a Multi Option Deposit, is meant to handle. This deposits is actually linked to a savings account and this helps because in case the depositor issues a cheque for an amount that is not present in the savings account, the balance is withdrawn from the FD and paid. The depositor also gets the option to withdraw amounts in multiples of Rs. 1,000 through ATMs.
Eligibility Criteria for applying for MODs
The eligibility criteria for this FD is the same as that for all other FDs. This is a product that is available to all those residing in India, and at times also to non-resident Indians. This deposit may also be available to entities like HUF, companies, organisations and various other groups of people.
Features of the SBI Multi Option Deposit
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Account Type
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Single and Joint
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Amount
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Min: The minimum amount that can be invested in this term deposit is Rs. 10,000. If further deposits are made, then they need to be in multiples of Rs. 1,000.
Max: The bank has assigned no upper limit on the amount that can be invested in this account.
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Rate of Interest
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Min: The minimum interest rate that can be earned on this deposit is 7.25% per annum.
Max: The maximum interest that can be earned is 7% per annum.
The interest rates will depend on the tenure of the deposit and the amount that is deposited.
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Tenure
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Min: The minimum tenure for which this deposit can be opened is 1 year.
Max: The maximum permissible tenure for this deposit, unlike regular FDs, is 5 years.
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TDS
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Tax can be deducted at source if the interest earned on the deposit is more than Rs. 10,000 during the financial year. The tax rates applicable can be 10% or 20% depending on the depositor’s ability to provide PAN details.
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Loan against the scheme
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This deposit cannot be used to secure a loan.
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Nomination (if any)
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Nomination facilities are available with this deposit.
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Auto Renewals
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Not applicable
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SBI MOD interest rates
The interest rates for the SBI MOD is the same as that for other fixed deposits.
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Tenure
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Interest rates (per annum)
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7 days to 45 days
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5.25%
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46 days to 179 days
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6.5%
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180 days to 210 days
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6.75%
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211 days to less than 1 year
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7%
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1 year to 455 days
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7.25%
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456 days to less than 2 years
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7.5%
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2 years to less than 3 years
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7.5%
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3 years to less than 5 years
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7%
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5 years and up to 10 years
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7%
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*Interest rates as of 1/12/2015
With this fixed deposit, senior citizens will be earning 0.25% more than the applicable rates of interest. For those depositors, who are working for SBI or have retired from the organisation, the interest rates are 1% more than the applicable rates.
Always remember that banks can change the interest rates from time to time so it best to find out the current rates before investing.
FAQ's :
Q. What determines the mode of operation for this deposit?
A. The mode of operation depends on the savings account linked to the account. If the account is a joint account then the MOD too with be operated jointly.
Q. Can I open and close this account online?
A. While it is possible to open an SBI MOD online, it is not possible to close it online.
Q. Can I open a MOD with any type of account linked to it?
A. No. MODs can only be opened with a savings bank account linked to them and even then the conditions state that the account needs to be an active one; dormant or discontinued accounts won’t work.
Q. What happens to the maturity amount in this FD?
A. In most cases, the maturity amount can be transferred to an account of your choosing but with MODs the maturity amount is only deposited in the account to which the FD is linked.
Q. Are premature withdrawals permitted for this fixed deposit?
A. Yes, depositors can go in for a premature withdrawals but such withdrawals will be subject to the rules for TDR and STDR.
Details
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