State Bank of India (SBI), country’s largest bank on basis of its assets, offers loan against Fixed Deposit (FD) account at relatively lower interest rates than those charged on normal loans, said the lender on it’s corporate website- sbi.co.in. SBI’s loan against fixed deposit (FD) allows availing of loan without breaking the FD account. This offering of SBI makes fund readily available whenever the customer desire or need it, be it a sudden vacation or emergency cash requirement for medical treatment, said SBI.
Here are 10 things to know about SBI’s loan against Fixed Deposit (FD) account:
1. Individual customer holding fixed deposit (FD) or special fixed deposit account with SBI in single name only can avail the facility online. Joint account holders can avail this facility at SBI branches.
2. Under SBI’s loan against fixed deposit (FD), customer can avail 90 per cent of his/her special fixed deposit value and 75 per cent of his/her fixed deposit as overdraft facility online. At branch level, the customer can avail 90 per cent of underlying security value as demand loan or overdraft facility.
3. Both demand loan and overdraft facility is available as per customer’s need.
4. The minimum loan amount for availing online overdraft facility is Rs 25,000. There is no specific minimum loan limit for advances at the branch level.
5. The maximum overdraft limit which can be availed online against fixed deposit is Rs 5 Crore. There is no specific loan limit for advances at the branches.
6. Security lien is available on underlying fixed deposit.
7. Suitable repayment schedule is fixed depending upon the repayment capacity of the borrower for loan taken through branches. Maximum repayment period has been capped at 5 years against special fixed deposit accounts and 3 years against fixed deposit accounts respectively for overdraft availed online, notified SBI.
8. Interest rate of 1 per cent above the relative fixed deposit is applicable.
9. SBI charges zero processing charges for providing loan against fixed deposit (FD). Also there are no prepayment facilities in this.
10. The maximum repayment period overdraft against special fixed deposit account is 5 years or residual period which is less, subject to minimum of 6 months. The maximum repayment period overdraft against fixed deposit is 3 years or residual period which is less, subject to minimum of 6 months. For loans sanctioned at branch level, suitable repayment schedule is fixed depending upon the repayment capacity of the borrower