The State Bank of India (SBI) has introduced its Har Ghar Lakhpati (HGL) scheme to help its customers accumulate a sum of ₹1 lakh or more. This plan’s primary goal is to accomplish ‘Lakhpati’ status for the account holders by the end of their scheme maturity.
Any resident Indian may apply for an SBI Har Ghar Lakhpati (HGL) account. However, before you start depositing and using this recurring deposit product, it is important to know a few details discussed here.
How Much Investment Is Needed for ₹1 Lakh Via SBI Har Ghar Lakhpati?
For general HGL participants, the interest rate is 6.75% for a tenure of 3-4 years. Similarly, senior citizens will be offered a 7.25% return over a similar term. Meanwhile, staff and senior staff members can enjoy rates of up to 8.25% for the identical tenure.
Your fixed contribution in a recurring deposit earns monthly interest which in turn gets compounded quarterly.
Accordingly, the general public can save ₹1 lakh within 3 years by contributing ₹2,500 each month to the SBI Har Ghar Lakhpati RD. A monthly investment of ₹1,810 can yield ₹1 lakh in 4 years. Finally, if you pick a 5-year goal, then an instalment of ₹1,407 will be sufficient to reach ₹1 lakh.
As you may see the maximum returns for regular customers here is 6.75%.
However, right now you can earn up to 9.50% annualised returns on your monthly savings by booking FD SIPs on Stable Money. To explore more, install our app now!
Who Can Invest in the New SBI Har Ghar Lakhpati RD?
All Indian residents, including children above 10 years of age, can opt for this new RD scheme launched by the SBI. Both single and joint account opening requests are accepted at this moment. However, if a minor is not able to sign at present they won’t be allowed to open a single RD account. Instead, they can proceed with the account opening process with their parents/legal guardians.
Key Features of SBI Har Ghar Lakhpati
Customers can view the Lakhpati scheme as a personalised RD product offered by SBI, providing significant flexibility. Its primary aim is the accumulation of ₹1 lakh or more through small savings every month. Below you can find some salient features of this recurring deposit scheme:
Tenure
SBI Har Ghar Lakhpati account can be opened for a minimum of 3 years and a maximum of 10 years. However, the instalment amount will vary depending on an individual’s savings goal upon maturity and the chosen tenure.
Minimum and Maximum Instalment Amount
The amount of monthly deposit is pre-calculated and customers can choose among the available options depending on how fast they wish to reach their goal of ₹1 lakh. For example, you can save ₹2,500 a month in this RD if you want to reach your first ₹1 lakh goal in 3 years.
Maturity Date
After you start the account, the maturity value of your recurring deposit is computed and paid every month following 30 days after your last payment or on the expiry of the investment term, whichever comes first.
Premature Closure
If a depositor decides to withdraw their funds before the agreed-upon maturity period, a penalty of interest will be levied between 0.50%-1.00%.
Let us assume that the payment amount is less than ₹5 lakhs. In that case, premature withdrawals will incur a penalty of 0.50%. Above ₹5 lakh corpus, SBI will charge a 1% penalty on RD interest rate to process requests for premature withdrawal. Additionally, if someone decides to withdraw their amount within 7 days of account opening, no interest will be credited in such cases.
Tax Deduction at Source
Tax rules are applicable as per the Income Tax Act, of 1961. This means a 10% TDS is levied on all returns that equal or exceed ₹10,000 in a year. If your annual income does not come under the taxable bracket, you may prevent this deduction by submitting a 15G Form.
Service Charge of the Account
The SBI deducts a service charge of ₹10 at the time of paying out RD returns. Additionally, service charges may apply if there is a default in payment for three or more consecutive instances or when the account has not been regularized.
Final Word
The overall savings potential of Indians is now enhanced for those who choose to invest in SBI Har Ghar Lakhpati. It is completely safe and backed by the State Bank of India, trusted by generations of Indians.
Additionally, several more profitable DICGC-licensed fixed deposit schemes are available on the Stable Money app. You can explore these schemes too to identify avenues for higher returns.
Frequently Asked Questions
- Which RD is best at SBI?
Senior citizens can earn up to 7.25% returns by investing in SBI Har Ghar Lakhpati RD for 3-4 years.
- What is the SBI 7.60 interest rate?
Under the SBI Amrit Kalash term deposit scheme, senior citizens can get 7.60% per annum. One can book this scheme online through the SBI YONO mobile app.
- Is RD better than FD?
Both RDs and FDs serve different purposes. Traditional fixed deposit accounts better suit those who are looking to invest a lump sum amount. On the other hand, recurring deposit accounts are ideal for individuals who prefer to invest small amounts regularly and take advantage of high returns.
