Overview of State Bank of India
State Bank of India is a government-owned banking and financial services company, headquartered in Mumbai, Maharashtra. It has around 17,000 branches, including 190 foreign offices, making it the largest banking and financial services company in India, in terms of assets. Bank of Madras, Bank of Calcutta and Bank of Bombay, merged to form the Imperial Bank of India, which ultimately became the State Bank of India. In 1955, Government of India owned the Imperial Bank of India, with Reserve Bank of India holding 60% stake, and was renamed as State Bank of India. The government took over the stake held by the Reserve Bank of India in 2008.
Recurring Deposit from State Bank of India
The name and branch of a newly generated Recurring Deposit account will be same as given in the debit account, from which RD account is funded. The maturity amount is fixed based on factors such as: the instalments, tenure and type of account that the customer has chosen. The maturity value of RD is rounded off to the nearest rupee and paid after 30 days or when the stipulated deposit period expires. A savings, current, or OD account can be debited to open a RD account. The account selected for debiting should be a valid transactional account with the facility of internet banking activated. Customers can also open a RD account online with SBI through e-RD feature in SBI internet banking.
Features of State Bank of India Recurring Deposit
- Minimum monthly deposits of Rs.100 with no maximum limit. Additional deposits should be made in multiples of Rs.10.
- Minimum period of deposit is 12 months and maximum is 120 months.
- Loan / Overdraft up to 90% available against the balance in RD account.
- TDS is not applicable.
- Premature withdrawal is allowed with a penalty of 0.5% below the interest rate applicable for the period the deposit has remained with the bank.
- Loan or Overdraft facility is available with the balance in RD account as collateral.
- Penalty charges for not depositing monthly instalments on time are:
- For a period 5 years and less - Rs. 1.50 per Rs. 100/- per month
- For a period above 5 years - Rs. 2.00 per Rs. 100/- per month
- Passbooks are provided.
- Nomination facility is available.
Interest rates offered on State Bank of India’s Recurring Deposit
The interest rates vary from time to time and is applicable as per the Bank’s TDR / STDR for the deposit period. SBI web portal offers updated information on interest rates. The interest rate payable to SBI Staff and SBI pensioners is 1.00% above the applicable rates. The rate applicable to all Senior Citizens and SBI Pensioners is 0.25% above the rate payable to regular customers. Depositors can avail up to 8.75% as interest on RD.
Nomination for RD
Nomination facility is available. While opening a RD account, the depositor will be provided with an option to retain the nominee(s) as stated in the debit account from which the RD is funded. The customer will have to visit his/her branch if he/she intends to add a new nominee.
SBI Recurring Deposit FAQ’s
How to open a Recurring Deposit account in State Bank of India?
A customer can open an RD account with SBI through any branch of the bank. If you have internet banking user-name and password, and at least one transaction mapped to the user-name then you can open a Recurring Deposit (RD) account through internet banking.
What is the Minimum & Maximum amount to open a Recurring Deposit in State Bank of India?
The minimum amount of monthly installment is Rs.100. The installment amount and number of installments cannot be changed after opening the account.
While opening the RD account, whose name will appear on the account?
The RD account will be opened under the name of the debit account holder who is funding the RD account. If you have opened the RD account through your savings account, the RD account will be under your name.
What are the Minimum or Maximum period for an RD in State Bank of India?
The period of deposit is a minimum of 12 months and a maximum of 120 months.
Is TDS (Tax Deductible at Source) applicable on Recurring Deposits?
No, TDS is not applicable.
Does the RD account of State Bank of India provide loan against the deposit?
Loan up to 90% of the deposit is provided to the depositor with the balance in the Recurring Deposit account treated as security, at an interest of 0.5% per annum ( above the interest rate applicable for the deposit).
Do Senior citizens get any extra benefit on Recurring Deposits?
Yes, additional rate of interest for Senior Citizens is provided. The age of the customer, in this case, should not be below 60 years on the date of opening the RD account. The minimum tenure and minimum amount applicable for additional rate of interest for senior citizen will be as per Bank's policy.
How is the penalty on premature closure of the Recurring calculated?
Penalty will be applied on the interest rate paid-out to the RD in case of premature withdrawal of RD. It will be a 1.00% deduction on the rate applicable for the period the deposit has remained with the bank.
What is the penalty for default in installment payment?
If a depositor fails to pay the installment on the due date for three successive months, a service charge of Rs 10/- is applicable. Penalty in case of delay in payment of installment of RD held for a period of 5 years or less shall be Rs 1.50 for every Rs 100 per month, and Rs 2.00 for every Rs. 100 per month for an account which is held for more than 5 years
Is there a way to calculate maturity amount before opening an RD account online?
The maturity amount is calculated based on various factors such as the installments, tenure, and type of account. The maturity value of an RD account is rounded off to the nearest rupee and paid on the maturity or expiry of the period. You will be able to calculate the maturity amount, maturity date and rate of interest without opening an RD account. You will need to use the ‘Maturity Value Calculator’ available on the ‘Related Links’ section.
Know the Current Recurring Deposit Rates:
- SBI Recurring Deposit Rates
- SBI Recurring Deposit Interest Rate Comparison with Other Banks and Institutions
SBI RD Schemes:
News About SBI Recurring Deposit
SBI To Find Customers Who Do Not Maintain Minimum Balance
The State Bank of India (SBI), the country’s largest bank, will begin charging customers who do not maintain the minimum balance requirement in their accounts. The charges will be levied with effect April 1st, 2017. The charge will be levied based on the difference between the required balance and the shortfall amount.
The minimum balance requirement for savings bank accounts is Rs.5,000 for metropolitan areas, while it is Rs.3,000 for urban areas. Customers in semi-urban areas have to maintain a balance of Rs.2,000 while it is Rs.1,000 for rural areas.
For metropolitan areas with a shortfall greater than 75% of the requirement, a fee of Rs.100 plus service tax will be levied, while it will be Rs.60 plus service tax for a shortfall of between 50-75% of the requirement. Shortfalls of less than 50% will be charged Rs.40 plus service tax.
n urban areas, a shortfall of more than 75% will incur a fee of Rs.80 plus service tax.
The bank had relaxed the minimum balance requirement a few years ago in an attempt to lure new customers. However, with the bank merging with 5 of its subsidiaries, it will now have close to 50 crore customers and stands to make a significant profit if even a fraction of its customers default on the minimum balance requirements.
10th March 2017
SBI Cuts Recruitment on Account of Merger
State Bank of India’s (SBI) merger with its associate banks is expected to bring about a 20% drop in recruitment, as the merger might result in a surplus of employees. Associate banks have already stopped recruitment in light of the merger. The bank will still be hiring as there is a requirement for new blood, but not as aggressively as they did earlier. SBI usually hires approximately 13,000 new recruits every year based on the attrition rate, however, the bank has reduced this over the past two years, mainly in clerical staff. The bank did not recruit any clerical staff last year. This year SBI will be hiring around 17,000 clerical staff which includes 3,008 agri staff, which the bank is recruiting after a gap of several years as they have a larger market for agricultural lending now. The associate banks involved in the merger are, State Bank of Mysore, State Bank of Bikaner and Jaipur, State Bank of Patiala, State Bank of Hyderabad and State Bank of Travancore.
26th October 2016
CDM Limit Increased By SBI
The cash deposit limit of CDMs (Cash Deposit Machines) has been increased to Rs.2,00,000 by the State Bank of India. This increase has made it easy for the customers to deposit cash into their recurring deposit (RD) accounts, loan accounts, PPF accounts, Current and Savings accounts. This step will also help customers save time as they do not have to stand in long queues at any branch of the bank.
17th September 2016
State Bank of India to Merge Five Subsidiaries to Rank Higher on Global Banking Stage
The State Bank of India is expected to undertake a proposed merger under which five of its associate banks will take a giant step towards banking consolidation with Bharatiya Mahila Bank. SBI’s acquisition of its five subsidiaries along with the niche provider of banking services for female customers over the past three years is expected to push the merged institution much higher up the standings on the international banking stage. The economy as well as the lender are expected to benefit from the operation, and the enhanced balanced sheet size is anticipated to allow the bank to attain better pricing on both domestic deposits as well as internationally sourced funds, thereby helping it reduce lending rates while increasing profitability.
5th August 2016
SBI And IOC to Tie Up to Benefit Farmers
The State Bank of India (SBI) and the Indian Oil Corporation (IOC) have linked to implement a scheme to benefit farmers. The bank will be implementing the scheme through IOC’s Kisan Seva Kendras.
According to a statement released by the bank, banking services such as recurring deposit, savings account, social security programmes and Aadhaar seeding will be available through kiosks set up in the Kisan Seva Kendras.
This will benefit a large number of farmers who do not have access to full-fledged banking services close to their farms.
The IOC’s over 65,000 Kisan Seva Kendras are located across the country and provides the perfect platform for SBI to extend such facilities to such a large customer base.
One of the services they will be providing are debit cards, which will eliminate the need to carry large amounts of cash for the purchase of various agricultural products.
25th July 2016
Thomas Cook and SBI Launch ‘Holiday Savings Account’
One of the top tour operators has partnered with State Bank of India to launch an account geared towards holiday savings. Called the ‘Holiday Savings Account’, SBI account holders can choose a holiday package from Thomas Cook and open a Recurring Deposit (RD) with the bank as a way to pay for it.
Account holders will also earn interest on their savings, making it an added incentive. They can also opt out of the holiday if they wish to. The RD will be for a 12 month period.
The advantages of the HAS are manifold, the main one being customers will be paying for their selected holiday at the current prevailing rate. Since holiday packages generally get more expensive closer to the holiday season, HAS holders will be saving on the price difference.
They will also receive a top-up from Thomas Cook for the 13th month, coupled with the interest and a zero exit clause.
Those wishing to avail of this scheme have to log onto the Thomas Cook website and choose their package; they have to then log on to the SBI portal and open a recurring deposit account, depending on the holiday cost. They will have to make 12 monthly payments towards the holiday cost.
The packages offered are inclusive of all taxes and charges, and HAS account holders can benefit from cheaper rates on their dream holiday through this scheme.
10th February 2016