Multiple banks. Different interest rates. Call it a "conflict of interest".
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    Loan Against Fixed Deposit

    We found 32 Loan Against Fixed Deposit

    Bank Name
    Interest Rate Range
    Processing Fee Range
    Loan Amount
    Tenure Range
    11.49% - 15.99% Fixed
    1% to 2.5%
    30L Max
    1-5 Years
    Response Time Within 30 minutes
    Rs.1000 Amazon voucher free Ad
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    10.99% - 14.49% Fixed
    0
    30L Max
    1-5 years
    Response Time Within 30 minutes
    Rs.1000 Amazon voucher free Ad
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    Customer Reviews
    12% - 18% Fixed
    Up to 1.5% One time fee
    15L Max
    1-5 years
    Response Time Within 30 minutes
    Rs.1000 Amazon voucher free Ad INSTANT DECISION
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    11.99% - 19.50% Fixed
    0 One time fee
    20L Max
    1-6 Years
    Response Time Within 30 minutes
    Rs.1000 Amazon voucher free Paperless approval option available
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    Customer Reviews
    13.99% - 16.99% Fixed
    1% - 2% One time fee
    20L Max
    1-5 years
    Response Time Within 30 minutes
    Rs.1000 Amazon voucher free Paperless Approval Option Available
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    Good to Know
    Eligibility Criteria
    11.00% - 17.99% Fixed
    2.25% (min. ₹1149) One time fee
    20L Max
    1-5 Years
    Response Time Within 30 minutes
    Rs.1000 Amazon voucher free Paperless approval option available
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    Customer Reviews
    10.85% - 11.85% Floating
    0.5% One time fee
    50 K - 10 L
    1-5 Years
    Response Time Within 30 minutes
    Guarantor Required Paperless approval option available
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    10.99% - 19.8% Fixed
    Up to 2.5% One time fee
    25L Max
    1-5 years
    Response Time Within 30 minutes
    Rs.1000 Amazon voucher free Paperless approval option available
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    Customer Reviews
    11.99% - 19% Fixed
    Up to ₹3000 One time fee
    25L Max
    1-5 years
    Response Time Within 30 minutes
    Rs.1000 Amazon voucher free Paperless approval option available
    What you'll love
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    Perks
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    Good to Know
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    Customer Reviews
    17.25% - 37% Fixed
    1.5% to 6.0% One time fee
    15L Max
    1-4 Years
    Response Time Within 30 minutes
    Rs.1000 Amazon voucher free Paperless approval option available
    What you'll love
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    11.49% - 20.15% Fixed
    Up to 2%
    15L Max
    1-5 years
    Response Time Within 30 minutes
    Rs.1000 Amazon voucher free
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    Perks
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    Fees & Charges
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    Eligibility Criteria
    Customer Reviews
    11.5% - 13.25% Fixed
    0 One time fee
    30L Max
    1-5 Years
    Response Time Within 30 minutes
    Rs.1000 Amazon voucher free
    What you'll love
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    Perks
    Fees & Charges
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    Loan Against Fixed Deposit is Rated as "Great!" by 74151 Users

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    Personal Loan BYTES FROM OUR KITCHEN

    What is loans against fixed deposits?

    A loan against Fixed Deposits is precisely what the name implies; it is a loan obtained against the amount invested in a fixed deposit. Loans against fixed deposits can be a smarter option while availing loans, as these are easier to obtain and the interest rate for these loans is much lower than traditional loans.

    Loans are traditionally obtained to meet emergency needs, which involve liquid cash. Breaking a fixed deposit might come to mind to meet this requirement but obtaining a loan against the fixed deposit makes more sense. Money invested will continue to fetch interest once the loan has been cleared and the interest paid on loan could be less than the overall interest earned at times.

    Fixed Deposits are a popular investment choice and a majority of individuals keep their savings in such deposits. Most fixed deposit loans are given in the form of an overdraft against the deposited amount. This loan ensures that any emergency can be dealt with and the amount in the deposit remains as it is.

    What are fixed deposits?

    A fixed deposit refers to a sum of money invested in a bank or any other financial institution which offers the depositor a specific interest which is paid for the duration of the deposit. A fixed interest rate is given on the investment for a fixed period of time. Once the investment reaches maturity, both the principal amount and the interest are paid back to the investor. A Fixed Deposit account is one of the most favoured accounts, owing to the high rate of interest offered by banks and financial institutions.

    A Fixed Deposit is generally used by both individuals and organisations to store liquid funds for a fixed period, which can then be used for any future needs. Fixed Deposits are considered a safe investment option and while the interest rate offered by them is on the lower side, they still offer decent returns on the investment. Fixed Deposits are often referred to as Term Deposits in many countries.

    Interest rates on Fixed Deposits vary according to the term period, with longer term periods attracting better rates. Fixed Deposits can be opened for terms ranging from a minimum of 7 days to a maximum of 10 years.

    How much loan can be availed against Fixed Deposits?

    The loan amount which can be obtained against fixed deposits depends on the initial amount invested in them. A majority of banks which offer loans against fixed deposits provide loans upto 70-90% of the fixed deposit investment. This loan amount varies from bank to bank and certain banks are known to provide loans up to 95% of the investment, in cases where the initial investment is over Rs 50 lakh. Lower investments generally translate into lower loan amounts.

    Loans over Rs.1 crore can be availed based on the investor’s relationship with the bank and there is generally no fixed upper limit on the loan amount, as it entirely depends on the money invested in the fixed deposit. Higher the fixed deposit amount, higher the loan in most cases.

    Loan Tenure

    The tenure of any loan obtained against fixed deposits depends on the tenure of the fixed deposit. The loan tenure cannot extend beyond the term of the fixed deposit and is available only for the remaining period up to maturity. For example, if a loan is availed against a fixed deposit of 5 years after 1 year, the individual has to repay the loan within the next 4 years, before the fixed deposit reaches maturity. In case of foreign currency loans, most banks provide it for a minimum period of one year and the maximum period to clear the loan is on maturity of the fixed deposit. The loan can be availed at any time during the fixed deposit tenure.

    Features and Benefits of Loan against Fixed Deposits

    An individual who chooses to avail a loan against fixed deposits has many advantages over conventional loans. Some of the major features and benefits are mentioned below.

    • High Loan Amount – Individuals can get loan amounts up to 95% of the fixed deposit investment. This means higher the investment one has higher the loan they can get. Most banks sanction loans which are 80-90% of the invested amount and if the individual has a long history with the bank they can get higher amounts sanctioned.
    • Hassle Free – Most banks offer loans against fixed deposits without much hassle. An individual is not required to fill out detailed forms or go through a strict process before getting the loan. The process is fast and simple.
    • Low interest – The interest for loans availed against fixed deposits are comparatively lower than Interest rates for Personal Loans obtained by other means. The interest rate is generally 1-2% more than the interest rate an investor gets on his/her deposits. Interest is charged only on the amount utilized as loan and not the entire fixed deposit amount.
    • Flexible Repayment – The loan amount can be paid in flexible terms, with no strict payment dates and terms.
    • Liquidity – Loans obtained against fixed deposits offer instant liquidity in case of emergencies. These loans allow the individual to keep the fixed deposit secure and offer an alternative to breaking the fixed deposit to cater to urgent monetary needs.
    • Low processing fee – Loan applicants are not subjected to high processing fee by banks and the loan can be availed for negligible processing fee. Applicants who are on good terms with the bank could also get the entire processing fee waived.
    • No prepayment charges – Most banks do not charge a prepayment fee in case of early payment of loan.
    • No foreclosure fee – A majority of the banks do not charge any penalty in case of foreclosure on loans obtained against fixed deposits.
    • Payment only for utilisation – Loans against fixed deposits offer individuals the flexibility to pay for the loan only when they use it. They always have access to the available credit when they need it.

    Purposes for which loan money can be used

    • Personal Expenses – The loan amount can be used to pay for any personal expenses like home renovation, vehicle purchase, education bills, medical emergencies, wedding expenditure, and so forth.
    • Property – The money can be used to purchase property in India.
    • Business – The money can be used to meet business requirements such as purchasing assets, equity contribution or as working capital.

    Purposes for which loan money cannot be used

    A few banks mention certain restrictions on using loan money for certain purposes.

    • Investment in Chit-funds - The loan money cannot be used to invest in chit-funds or similar companies.
    • Investment in shares – Some banks do not allow the loan money to be used as an investment in shares or securities.
    • Re-lending money – The money obtained as loan cannot be re-lent to other individuals.
    • Agricultural Activities – A few banks restrict loan applicants from using the money for agricultural or plantation activities.

    Eligibility criteria

    • Applicant should have a fixed deposit account with the bank.
    • Applicant should be at least 21 years old.
    • Individual businesses which want to avail loan should be either sole proprietorship or partnership firms.
    • Certain banks allow only private limited companies and stock brokers to avail this loan.
    • The fixed deposit should not have reached maturity at time of applying for loan.
    • Loan can be obtained only if the deposit is free from any restraint or encumbrance.
    • Loan cannot be granted against fixed deposits which are held in the name of minors.
    • Loan can be availed only against deposits held by members of the same household/family.
    • Loan cannot be availed if the applicant has plans to close the deposit.

    Documents required

    • Filled up application form.
    • Fixed Deposit details including receipts discharged in favour of the banks.
    • A cancelled cheque might be required if loan is being taken from financial institutions other than banks.
    • Duly signed agreement letter.
    • Passport size photographs.
    • Valid identity proof.

    Interest rate and fees

    The interest rate for loans against fixed deposits are comparatively lower than the rates charged for other types of loans. Banks generally charge an interest rate which is 2-2.5% higher than the interest rate being paid by the bank on the fixed deposit. This amount varies from bank to bank, with private banks generally charging a higher interest than nationalised banks.

    For example, let us say that an individual customer has a fixed deposit which earns him interest at the rate of 10% per annum. If he/she wishes to avail a loan against this fixed deposit the bank will charge him/her an interest rate of 12 to 12.5%, depending on bank policies. This interest will be charged only for the period for which the loan is availed and not the entire term of the fixed deposit.

    Banks generally charge a minimum processing fee, which can be a few hundred rupees to process the loan. This fee can be waived if the applicant is on good terms with the bank and has a good reputation. A few banks do not charge any processing fee or hidden charges and most banks do not charge pre-closure charges either.

    Repayment

    Banks offer customers different repayment options. There are generally no fixed repayment dates and a working relationship can be charted out between the bank and the loan applicant. Some banks insist on payment of interest on a monthly basis while some allow the interest to be paid at maturity. In cases where the interest plus loan amount exceeds the deposit the customer might be asked to repay part of the amount immediately.

    Advantages over breaking the Fixed Deposit

    Taking a loan against fixed deposits can be better than breaking the fixed deposit to meet demands. The first benefit is that one does not have to pay a penalty for premature withdrawal, which is generally about 1% of the rate.

    The interest rate which is charged by banks for loans against fixed deposits is much lower than other rates. Banks generally charge a rate which is 2% higher than the interest being earned on the deposit. A loan availed at this rate might ultimately cost the applicant no money, with the interest earned being more than the interest paid.

    Consider the following case where a man who has a fixed deposit of Rs 10 lakh for 2 years at an interest rate of 10% per annum. If he decides to take a loan of Rs 8 lakh for 1 year at an interest rate of 12% he ends up paying Rs 9600 as interest. The interest accumulated on the sum over the complete duration is Rs 11,000. Thus even after paying off the interest on the loan the man manages to earn Rs 1400 as interest.

    FAQs

    Can NRIs avail loan against Fixed Deposits?

    Yes, NRIs can avail loans against fixed deposits, if they satisfy certain conditions.

    Are loans against fixed deposits exempt from tax?

    No, the interest earned on fixed deposits are not exempted from tax. The loan amount is subject to tax if it falls under the taxation bracket.

    What is the minimum and maximum loan which can be availed against fixed deposits?

    Certain banks state that the minimum loan which can be availed against fixed deposits should be Rs 25,000 and the maximum amount which can be availed is 95% of the deposit value. These numbers vary from bank to bank.

    Is interest for loans charged for the entire duration of fixed deposit?

    No, an interest is charged only for the period till the loan is cleared. No interest is charged on the amount once all dues are paid.

    Does the Fixed Deposit continue to earn interest during the period of loan?

    Banks do not give the entire deposit as loan amount and the amount which is left in the Fixed Deposit after processing the loan continues to earn interest even during the loan period.

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  • Loan Against Fixed Deposit Reviews

    • HDFC Bank Personal Loan
      "Fast and Best Service in HDFC"
      0.5 5.0/5 "Blown Away!"
      I am an account holder of HDFC, hence my home branch have reached me and provided the best loan option. They sanctioned the personal loan with the interest rate around 14% and they processed within same days. Hence I have cancelled HDFC online loan request.
      Was this review helpful? 1
      , dindigul
      Reviewed on May 27, 2017
    • Kotak Personal Loan
      "Its Better"
      0.5 4.0/5 "Great!"
      After giving the loan request to Kotak Mahindra bank, they had called me and shared the loan process update. But due to the personal reason I had postponed the plan. Other banks are providing beneficial interest rate but Kotak charges high rate.
      Was this review helpful? 0
      , new delhi
      Reviewed on May 27, 2017
    • Bank Bazaar Customer Support
      "Excellent services"
      0.5 5.0/5 "Blown Away!"
      The services at Bankbazaar has been up to my satisfaction. It was a nice experience because the team was helpful in giving me the details and they also checked about my requirement as well. They were in constant touch and the website was good and user friendly.
      Was this review helpful? 0
      , faridabad
      Reviewed on May 27, 2017
    • IDBI Personal Loan
      "Good Service"
      0.5 5.0/5 "Blown Away!"
      IDBI is good in the rate of interest. I got the interest rate of 9.8% for the personal loan with the processing fee of 1% of the loan amount. Documentation process is very simple and it is surely a recommendable bank. Even they maintain good customer service.
      Was this review helpful? 0
      , bangalore
      Reviewed on May 27, 2017
    • Bank Bazaar Customer Support
      "Prompt service"
      0.5 5.0/5 "Blown Away!"
      I do not have any suggestions for bankbazaar as everything went good with them when I approached them for the loan process. Their website is easy to handle and it is informative. I got very good responsiveness and good customer service from bankbazaar.
      Was this review helpful? 0
      , bangalore
      Reviewed on May 27, 2017
    • Citibank Personal Loan
      "High Interest Rate"
      0.5 4.0/5 "Great!"
      Citi bank is on higher end in terms of interest rate. They quoted some high rate of interest for the personal loan. When I checked with other banks, I got lower interest rate than CITI bank so I closed my application with CITI. Customer service and everything is fine except the interest rate.
      Was this review helpful? 0
      , bangalore
      Reviewed on May 27, 2017
    • Kotak Personal Loan
      "Good overall"
      0.5 4.0/5 "Great!"
      Kotak Mahindra Bank has been good in the services for the personal loan. The team contacted me on time and informed me the details. The loan could not process due to the banking norms. I was offered a normal interest rate and processing charges.
      Was this review helpful? 0
      , faridabad
      Reviewed on May 27, 2017
    • Tata capital Personal Loan
      "Interest rate is high "
      0.5 2.5/5 "Just OK"
      My existing home loan was running with AXIS, I thought its better to take personal loan from same AXIS bank. Hence I have not taken personal loan from TATA Capital and their interest rate is too much high. Tata Capital charging around 13.99% but AXIS giving 11.99% of interest.
      Was this review helpful? 0
      , ahmedabad
      Reviewed on May 27, 2017
    • Bank Bazaar Customer Support
      "Overall good"
      0.5 4.0/5 "Great!"
      My overall experience with Bankbazaar was good. I was contacted on time and given the details.The website was good and informative. But when I click on the bank names to get more details is was taking me to the application page. Else good and no issues.
      Was this review helpful? 0
      , bangalore
      Reviewed on May 27, 2017
    • ICICI Bank Personal Loan
      "Prompt service"
      0.5 5.0/5 "Blown Away!"
      ICICI bank offered high interest rate for the personal loan which is 12.75%. Th services are very prompt and they are really good in processing the loan application. I did not have any issues with them in the entire process. All things went good with them.
      Was this review helpful? 0
      , pune
      Reviewed on May 27, 2017
    • Standard Chartered Bank Personal Loan
      "Good services"
      0.5 4.0/5 "Great!"
      Since I had to travel out of the country, I did not proceed ahead for the personal loan with Standard Chartered Bank. They did contact me a couple of time for the loan. The rate of interest was low but not the lowest, it was around 11.49% and the processing charges were normal.
      Was this review helpful? 0
      , bangalore
      Reviewed on May 27, 2017
    • Bank Bazaar Customer Support
      "Supportive Service"
      0.5 4.0/5 "Great!"
      Two years ago I availed the loan through bankbazaar. So again I approached bankbazaar for the personal loan this time. I got good response from them and their website is quite easy to handle. It would be fine if the mobile app is even more user friendly. Overall service is pretty good.
      Was this review helpful? 0
      , pune
      Reviewed on May 27, 2017
    • Capital First Personal Loan
      "Good Service"
      0.5 4.0/5 "Great!"
      When I applied for the personal loan with Capital First, they offered the loan but it was not up to my requirement also I got better offers from other banks so I just moved out from capital First. But their response and customer services are good with capital first. Interest rate and processing fee is good with Capital First.
      Was this review helpful? 0
      , pune
      Reviewed on May 27, 2017
    • Axis Bank Personal Loan
      "Good"
      0.5 4.0/5 "Great!"
      I have closed the personal loan with the Axis bank and the rate of interest was around 14.5% and the processing charges were okay with them. I would like to suggest that they can make lesser rate of interest for the customer, so that they can make the business. Customer service is fine one with them.
      Was this review helpful? 0
      , gurgaon
      Reviewed on May 27, 2017
    • HDFC Bank Personal Loan
      "Good"
      0.5 4.0/5 "Great!"
      I have made the balance transfer of my personal loan with the HDFC bank and the rate of interest was around 11.29%, which is really good. The loan amount got disbursed to my account within three to four days of time, also there were no processing charges with them till now.
      Was this review helpful? 0
      , gurgaon
      Reviewed on May 27, 2017
    • Kotak Personal Loan
      "Timely process has to be done"
      0.5 4.0/5 "Great!"
      I am not happy with Kotak Mahindra personal loan process, they took more than a month and they processed an EMI before sanctioning the loan. I took the amount of 3 lakhs with the tenure of 3 years and my EMI is 10,802, its running without any issues.
      Was this review helpful? 0
      , chennai
      Reviewed on May 27, 2017
    • Bank Bazaar Customer Support
      "Very good in services"
      0.5 5.0/5 "Blown Away!"
      The customer services are good at Bankbazaar and they know how to handle a customer. The portal is good and very much helpful. It helped me to identify the right bank by using the comparison tools on the portal. The follow up calls are also of great support to me.
      Was this review helpful? 0
      , raipur
      Reviewed on May 27, 2017
    • Bank Bazaar Customer Support
      "Easy to Navigate"
      0.5 4.0/5 "Great!"
      Bank Bazaar come to know through online but they are good in service, they are doing speedy service and they are analyzing the customer's profile and giving best service. The portal is also good to check multi information of banking products.
      Was this review helpful? 0
      , chennai
      Reviewed on May 27, 2017
    • ICICI Bank Personal Loan
      "Unhappy with the banking services"
      0.5 1.0/5 "Really Bad"
      I had applied for a personal loan with ICICI bank and it was not up to the mark. The customer support needs to be more professional and though I received a response, I am not happy with the overall services. I did not go to the extent to talk about the interest rate and charges.
      Was this review helpful? 0
      , raipur
      Reviewed on May 27, 2017
    • IndusInd Bank Personal Loan
      "They Should Bring New Ideas"
      0.5 1.0/5 "Really Bad"
      I have few other loans are running , hence when I gave loan request to Indusind, however they have rejected it. But I am a prompt payer, I could track my record and process the loan. Indusind not potential to get the customer inside as they dont provide praactive customer service.
      Was this review helpful? 0
      , chennai
      Reviewed on May 27, 2017
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