SBI Annuity Deposit Scheme is for those seeking to gain a monthly fixed income. If you are planning to utilize your investments for monthly income support you must go forward with this scheme. Investors are allowed to make a one-time lump sum investment and cherish the monthly income benefit. Depositors will earn a fixed amount of equated monthly installments (EMIs), upon making the deposit. The monthly installments include the principal amount and interest earned. But before opting this scheme as your monthly income partner you need to discover the below-described facts and conditions.
1. Required eligibility
It is mandated to meet the eligibility criteria before investing in the scheme.
- An individual must be an Indian resident, and he / she can also include a minor
- Both single and joint holding is available
- NRE and NRO are not eligible for this scheme
2. Key features
The below-listed are the key features offered by SBI Annuity Deposit Scheme
- The scheme is available across all the branches (except specialized credit intensive branches) in India
- The minimum amount based on a monthly annuity is Rs.1,000 for the relevant term
- One can deposit in the scheme for a minimum amount of less than Rs.25,000
- The applicable interest rate is the same as term deposits
- The rate of interest for SBI employees and SBI pensioners will be 1.00% above the standard rate.
- The rate of interest will be 0.50% (above the standard rate) for Senior Citizens of age 60 years and above
- Investors will receive the interest on the same account issuance date of the next month. However, the annuity will be paid on the first day of the next month in case the date is non-existent (29th, 30th & 31st).
- Annuity payment, net of TDS, is credited to the specified savings or current account
- Universal passbook is issued on behalf of the investor which is easily transferable amongst SBI branches.
3. Benefits of the scheme
Before making an investment decision, you need to know about the below-listed benefits of the scheme.
Tenure: Investors can choose from tenure ranging from 3 years, 5 years, 7 years and 10 years.
Payment options: Prepayment of the full amount will only be considered in case of the sudden death of the depositor
Interest: The interest rate provided by this scheme is equivalent to its fixed / term deposits. Hence, SBI provides 5.9 per cent interest on deposits maturing within 1 to 10 years, according to the current FD rates. However, a rate of interest of 5.5 per cent is given for 6 months or less than a 1-year term. On the other side, Senior citizens will get an interest rate of 6.4 per cent for a tenure of 1 year to 10 years.
Loan facility: Depositors are allowed to take overdraft/loan facility of up to 75 per cent of the balance amount in case of emergency. Remember that the further annuity payment will be deposited in the loan account only, once the loan is disbursed.
4. Terms and Conditions for SBI Annuity Deposit Scheme
Before investing in the scheme you must be aware of its T&C which are:
- As applied to a term deposit, the premature penalty is chargeable.
- Premature payment is permitted up to a maximum amount of Rs.15 lacs. However, a premature exit is only granted in case of death of the investor.