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    SBI Reinvestment Plan

    While a regular fixed deposit offers the depositor the option to withdraw the interest earned at regular intervals, the SBI Reinvestment Plan, as the name suggest, does not pay the interest out. What it does instead is to take that interest and add it to the principal and then the whole amount earns compound interest. Once the fixed deposit matures the depositor is able to withdraw the original amount invested, along with all the interest that has been earned till date.

    Eligibility Criteria for applying for the scheme

    The Reinvestment Plan offered by SBI is available to all the residents of India, even if they don’t happen to fall in any tax brackets or are not liable to pay taxes.

    Features of the Reinvestment Plan

    Account Type



    Min: The minimum instalment that can be deposited into this FD is Rs. 1,000

    Max: There is no limit on the maximum instalment that can be deposited in the FD.

    Rate of Interest

    Min: The minimum interest rate available is 5.25% per annum on deposits held for 7 days to 45 days. For the same period senior citizens earn 5.75% per annum.

    Max: The highest interest rates available are 7.5% per annum for periods ranging from 456 days to just under 3 years.


    Min: The least period for which this FD can be held is 7 days.

    Max: The maximum tenure for this FD is 10 years.


    Tax will be deducted at source if the interest earned from the fixed deposit crosses Rs. 10,000 in a financial year.

    Loan against the scheme

    This FD can be used to secure a loan and the loan amount can be up to 90% of the amount in the deposit.

    Nomination (if any)

    This deposit allows for nominees to be named in case the primary holder passes away.

    Auto Renewals

    The auto renewals depend on the maturity conditions of the deposit. If no maturity period is defined auto renewals will apply.

    SBI Reinvestment Plan interest rates

    The interest rates offered on this scheme are the same as those that apply to other fixed deposits held with the bank.


    Interest rates (per annum)

    7 days to 45 days


    46 days to 179 days


    180 days to 210 days


    211 days to less than 1 year


    1 year to 455 days


    456 days to less than 2 years


    2 years to less than 3 years


    3 years to less than 5 years


    5 years and up to 10 years


    *Interest rates as of 1/12/2015

    It is also worth noting that the interest rates offered to senior citizens is 0.25% higher. There is also a higher interest rate applicable for those who are or are pensioners from SBI and that rate is 1% above the applicable rates.

    Another thing worth noting that interest rates are determined by the banks and can change from time to time without notice.


    Q. What is the maximum amount that can be invested in this FD?

    A. There is no limit on the maximum amount that can be invested in this fixed deposit.

    Q. Are there any tax benefits associated with the Reinvestment Plan?

    A. Since this is not a tax saving fixed deposit, no tax benefits can be claimed on the amount invested in this account.

    Q. If I have set a maturity period, will the FD renew itself once it matures?

    A. Auto renewals, or renewals, do not apply to deposits that have a fixed maturity periods. They only apply when a maturity is not selected.

    Q. What if I am not liable to pay taxes?

    A. If you are not liable to pay taxes then you need to submit forms 15G or 15H to the bank so that it does not deduct tax on the interest earned.

    Q. Can I go in for a premature withdrawal?

    A. Yes, premature withdrawals are permitted but they will be subject to certain penalties. For accounts that hold less than Rs. 5 lakhs there are no penalties but for accounts that have more than Rs. 5 lakhs the penalty applied can be a reduction of the applicable interest rate by 1%.

    Useful Information on SBI Fixed Deposit

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