Today, financial security and stability are of utmost importance. Fixed deposit (FD) has emerged as a popular investment option. If you’re considering opening an FD account, it’s essential to understand the documents and eligibility criteria. This blog will guide you with the eligibility criteria, list of documents required for fixed deposits, process, and highlight the key features and benefits of fixed deposits.
About FD
Before diving into the documents required, let’s briefly understand what a fixed deposit is. A fixed deposit is a financial instrument offered by banks and financial institutions where an individual deposits a specific sum of money for a predetermined period, usually ranging from a few months to several years. In return, the depositor receives a fixed interest rate on their investment, ensuring steady returns.
Documents Required for FD
To open an FD account, you will need to provide certain documents . Here is list of Documents Required for FD The exact requirements may vary slightly between banks and financial institutions, but the following list covers the commonly requested documents:
1. Identity Proof
You will need to submit a valid proof of identity, such as:
- Aadhaar Card
- Passport
- Voter ID Card
- PAN Card
- Driving License
2. Address Proof
Proof of address is required to verify your residential address. Accepted documents include:
- Aadhaar Card
- Passport
- Utility bills (electricity, water, gas, etc.)
- Bank statement
- Rent agreement
Documents Required for FD Different Entities
1. For a Public/Private Company
- Company’s PAN card
- Certificate of Incorporation
- Bank account statement
- Latest telephone/electricity bill
- KYC of authorised signatory
- A resolution from the Board of Directors and power of attorney
- Passport size photograph
2. For Hindu Undivided Families (HUF)
- PAN card
- KYC documents
- HUF deed and declaration
- Passport size photograph
3. For Partnership Firms
- PAN card
- Registration certificate
- Partnership deed
- KYC of all authorised signatories
- Passport size photograph
4. For Trust and Foundations
- PAN card
- Registration certificate
- Trust deed
- Authorised signatory list
- Passport size photograph
5. For Registered Societies
- PAN card
- Board resolution for FD account opening
- KYC of all the authorised signatories
- Bank account statement/latest telephone bill/latest electricity bill
- Certificate of registration/incorporation
- Articles & Memorandum of Association
- Passport size photographs
6. For Statutory Board/Local Authority
- PAN card
- Certificate of registration/incorporation
- KYC of all the authorised signatories
- Bank account statement/latest telephone bill/latest electricity bill
- Permissions by government authority/ministry
- Passport size photographs
It’s essential to note that the exact documents required may vary from bank to bank or based on the type of account you are opening. Therefore, contacting your chosen bank or financial institution directly for specific document requirements is advisable.
Eligibility Criteria for FD (Documents Required for FD)
To open a fixed deposit account, certain documents required for FD besides this their is also a eligibility criteria must be met. While the specifics may vary between banks, the general eligibility requirements are as follows:
- Age: Individuals of legal age (18 years or above) can open an FD account. Some banks may also offer special schemes for minors or senior citizens.
- Residency: Resident individuals, non-resident Indians (NRIs), and Hindu Undivided Families (HUFs) are generally eligible to open FD accounts.
- Source of Funds: You must be able to demonstrate the legitimate source of funds being deposited into the fixed deposit account.
It’s important to note that eligibility criteria may be subject to change based on banking regulations and the policies of individual banks. It’s advisable to check with your preferred bank for the most up-to-date information.
Features & Benefits of Fixed Deposit
Fixed deposits offer several features and benefits, making them a popular investment choice. Here are some key advantages:
- Guaranteed Returns: FDs provide a fixed interest rate, ensuring predictable and guaranteed returns on your investment.
- Flexibility: You can choose the tenure of your FD, ranging from a few months to several years, based on your financial goals and requirements.
- Liquidity Options: Many banks offer premature withdrawal facilities or loans against fixed deposits, providing liquidity in case of urgent financial needs.
- Safety and Security: Fixed deposits are considered a safe investment as they are protected by insurance coverage offered by regulatory bodies like the Deposit Insurance and Credit Guarantee Corporation (DICGC) up to a specified limit.
- Higher Interest Rates for Senior Citizens: Senior citizens often enjoy higher interest rates on their fixed deposits, making it an attractive investment option for retirees.
Conclusion
In conclusion, fixed deposits offer a secure and reliable investment avenue for individuals looking to grow their savings . By providing Documents Required for FD is necessary to buy an FD ,documents and meeting the eligibility criteria, you can open an FD account and enjoy the benefits of stable returns and financial security. Remember to review the specific document requirements of your chosen bank and stay updated with any changes in the eligibility criteria to make the most informed investment decision.
FAQs
Yes, many banks provide the option to Can I open a fixed deposit account online?open a fixed deposit account online. You can visit the bank’s website or use their mobile banking app to initiate the process.
The minimum deposit amount required varies between banks. Depending on the bank’s policies, it can range from as low as Rs. 1,000 to higher amounts. Contact your preferred bank for specific details.
Yes, the interest rates on fixed deposits are fixed for the chosen tenure. It is important to note that the rates offered may vary between banks and may be subject to change periodically.
Yes, most banks allow premature withdrawal of fixed deposits. However, certain conditions and penalties may apply. It’s advisable to review the terms and conditions of your FD account regarding premature withdrawal.
Yes, the interest earned from fixed deposits is taxable as per the prevailing income tax laws. Depending on your tax liability, the bank may deduct TDS on the interest earned on FD. It’s advisable to consult with a tax professional for personalised advice.
Disclaimer
This article is solely for educational purposes. Stable Money doesn't take any responsibility for the information or claims made in the blog.
