Fixed deposits (FDs) are a common approach for senior citizens to invest. As it offers many added benefits such as higher interest rates and tax exemptions to senior citizens across the country. SBI the country's top lender had launched a special FD scheme known as SBI WeCare for senior citizens to gain additional 30 basis points interest on their fixed deposits.
All leading banks of the country gives 50 basis points (bps) extra to senior citizens on term deposits. However, SBI claims that 'SBI Wecare Deposit' will enable senior citizens to earn higher interest rates on their capital in the current falling rate regime. Things that you must know about SBI Wecare for senior citizens are:
1. Indian residents of 60 years of age or more are eligible to invest in this scheme and the scheme is applicable till 30 September 2020.
2. This scheme is applicable for a tenure of 5 years up to 10 years for senior citizens
3. Under this scheme, deposits will attract 0.8 per cent which is higher than the general market rate. A contribution made by a senior citizen under the WeCare scheme would earn a 6.20 per cent interest. This is essential to note that the investments under WeCare would represent a corresponding change if the fixed deposit interest rates as applied to the general public change.
4. Investors can opt to pay out interest monthly or quarterly for term deposits. The interest will be charged on maturity for special term deposits, and the interest rate will be calculated against TDS and credited to the bank account of the investor.
5. TDS is deducted for senior citizens if the total interest received during a fiscal year is more than Rs 50,000.
6. Senior citizens preferring for SBI Wecare Deposit FD can also take advantage of loans towards their fixed deposits.
7. In case of premature withdrawal, an additional premium of 30 bps is not payable
8. One can deposit up to Rs.2 Crore in the scheme