What are Flexi Fixed Deposits ?
FDs are believed to be the most secure form of investment which makes them very popular in India. Depending on different financial requirements, banks offer various types of fixed deposits. One such type of Fixed Deposit is Flexi Fixed Deposits. In this article, we will talk in detail about different important aspects of Flexi Fixed Deposit.
Flexi Fixed Deposits, as the name suggests, offers convenience and flexibility to their investors. It is a hybrid combination of an FD and a savings/recurring bank account. Therefore, a Flexi FD assists investors to avail liquidity of savings account and higher returns of FDs. Therefore, it is a special kind of FD offered by banks or financial institutions.
This deposit is different from a general FD in many ways. The primary feature of this deposit is that it combines the advantage of an FD and a savings account. Along with this, investors can choose to vary the number of monthly deposits and their installment amount in this deposit.
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The eligibility criteria may differ from bank to bank. The general requirements are as follows:
- Only individual investors can apply
- All Indian residents are eligible for this plan
- Minors are also eligible for this plan
Bank Offering Flexi Fixed Deposit Schemes
State Bank of India (SBI)
The minimum deposit amount required here is Rs 5,000 for Flexi Fixed Deposits and the minimum tenure stands at 5 years. This deposit offers their investors the flexibility of customizing their FD through flexible installments.
Currently, many banks are not offering Flexi FD schemes. But it is expected that these schemes will soon be offered in the near future. To get regular updates regarding the same, you can check out this space for more such related articles.
Also Read : Shriram Transport Finance FD Rates
Benefits of Flexi Fixed Deposit in 2023
Flexi FDs require investors to pay a lump sum amount once. They have the liberty and flexibility to choose any amount they would want to invest. Different banks have different deposit terms, one must make sure to check with the bank before opening your Flexi FD.
Flexi FDs returns are higher than the savings/current account. As a result, investors can be assured to earn better returns on the investment.
Loan against FD
Investors can avail of credit/loan against their FD. It is advisable that you check with the bank about their T&C for loan against Flexi FD as it varies from bank to bank.
The process of initiating a Flexi FD is easy and simple. Most banks across the country have a very transparent process; you have to fill a form and provide basic details like the amount they want to invest, the duration, and the contact details including phone number and address.
If investors have invested in multiple investment plans, it can get difficult to remember the maturity dates, and sometimes they may even miss renewing the investment. With the Flexi FD, they do not need to go through the hassle of the process of renewing as most banks offer auto-renewal facilities.
Investment Duration Flexibility
Investors can choose the investment tenure according to their needs, feasibility, and suitability. This signifies that they can stay invested for as short as or longer duration as they want to fulfill their financial goals.
Premature withdrawal of funds is allowed in most Flexi FDs offered by banks. This makes it a more convenient and preferred investment alternative than the traditional usual FD that did not have this option. The flexibility of early withdrawal allows investors to liquidate the investment in the event of an emergency.
Also Read : how to close fd in sbi online
Flexi FDs vs General FDs
The Flexi FDs offer certain benefits over the general FDs. This is primarily due to the flexibility and liquidity they offer. In a traditional FD, investors deposit a fixed sum of money for a fixed tenure at a predetermined return rate. Nevertheless, withdrawing this amount before the maturity period expires is not allowed which can be a problem in times of financial crunch and emergencies. On the other hand, The Flexi FD overcomes this problem by allowing the investors to withdraw a certain amount of funds from their current or savings account which is ultimately merged with the Flexi FD. In addition to it, the tenure, the amount, and the number of installments are not rigid for a Flexi FD. They can vary during the tenure of investment depending on the bank’s rules and guidelines.
Frequently Asked Questions - About Flexi Fixed Deposit
Q. how to do online flexi fixed deposits ?
A. Now you can open an FD online from the comfort of your own home. Just visit the bank's official website and register yourself. If there is any confusion related to opening an account, you can ask the support team directly.
Q. What is the working of the Flexi Deposits ?
A. Flexi FDs work just like usual FDs with the added advantage of comparatively more liquidity and flexibility. In addition to it, certain schemes also serve the double purpose of FD and Savings accounts.
Q. How to withdraw funds from the Flexi FD ?
A. Investors can withdraw funds from a current or savings bank account that is already merged with the Flexi FD account.
Q. Is TDS applicable on Flexi FDs ?
A. Yes, TDS applies to the interest earned on Flexi FDs.
Q. What is Flexi’s current account ?
A. When a Flexi FD is linked to a bank current account, it is referred to as a Flexi current account.
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