Did you know you need a Fixed Deposit Receipt (FDR) to withdraw your fixed deposit at maturity? An FDR is an essential document in a fixed deposit that banks or corporates provide as investment proof to investors. If you hold an FD (Fixed Deposit), you must know the basic details about an FDR and its importance. This article will help you understand what an FDR is and the several vital components related to the fixed deposit receipt.
What is a Fixed Deposit Receipt?
A fixed deposit receipt is a document offered by banks or NBFCs (Non-Banking Financial Companies) that acts as investment proof for investors. It includes details of the investor, maturity amount, interest rate, deposit type, extra charges and nomination details. An FDR receipt is absolutely necessary when you close your fixed deposit at maturity. Hence you need to keep it safe to make maturity withdrawal at the right time.
Importance of FDR
A fixed deposit receipt helps investors in many ways. Here is a list that highlights the advantages of an FDR;
During Premature Withdrawal – To make a withdrawal before maturity time, you need to produce your fixed deposit receipt to the bank or NBFC. Besides, your FDR will act as ownership proof and make the premature withdrawal process seamless.
During Renewal – At the time of an FD renewal offline, you need to surrender your FDR to the bank or NBFC, so the existing FD is renewed with new interest rates and other terms & conditions.
To Avail of a Loan – In case of emergencies, rather than breaking an FD, you can avail a loan against your fixed deposit. The bank or NBFC will consider your fixed deposit as collateral throughout your loan tenure. Upon full repayment, your FDR will be updated and returned to you.
8 Important Components of Fixed Deposit Receipt
A fixed deposit receipt has all the necessary details of your fixed deposit account. Below is the list of components you should find in a fixed deposit receipt.
Account Holder Details – When you open an FD, you will be given a unique customer ID number. Your fixed deposit receipt will also mention your bank account linked to your fixed deposit.
Type of Deposit – There are many types of fixed deposit investments. The two common types are cumulative and non-cumulative fixed deposits. An FDR will have information regarding the type of fixed deposit you have chosen. This helps you calculate your amount at maturity and the interest payouts.
Maturity Amount – Maturity is the most crucial component of a fixed deposit. An FDR shows the exact details of the interest and maturity amount you will receive at the end of your fixed deposit tenure.
Rate of Interest – Interest rates play a critical part in determining the amount at maturity. Your fixed deposit receipt must have the details of the interest rate. Any bank or NBFC will add details about interest rates on an FDR. However, it would be best to double-check the exact interest percentage fixed by the bank or an NBFC.
Renewal of FD, what can be done?
Also, if you are renewing a fixed deposit, compare your old interest rate with the revised interest rate as it is likely to change.
Calculate FD Interest Rate: Use Shriram FD Calculator and get an interest rate of up to 8.40%.
Maturity Date – When you book a fixed deposit for the longest tenure, you tend to forget the maturity date after a few years. A fixed deposit receipt will have the exact date your fixed deposit will mature. This detail will help you plan and achieve your financial goal on time without breaking your FD.
Auto-Renewals – You can track the interest rate changes on your renewed FD account if you have selected auto-renewal for your fixed deposit as you are aware of the exact date of the auto-renewal.
Charges on FD – A fixed deposit is cost-free to open and close after maturity. However, costs are involved if you want to make a premature withdrawal, which is called a premature withdrawal penalty. The penalty amount or percentage may vary with every bank or NBFC. So it is best for you to know the exact amount or percentage to avoid future confusion.
Nomination Details – Nomination details comprise the names and details of the nominee to whom the banks/NBFCs will transfer your fixed deposit in case of any unfortunate events.
Don’t Forget to Get your FDR!
If you are an investor with multiple fixed deposit accounts with different tenures, you will need an FDR to keep track of all your fixed deposit investments. Besides, it helps you stay attentive to your fixed deposit maturity dates and plan your future accordingly. With an exponential rise in online fixed deposit bookings, the FDR is available online. However, you can always keep a hard copy ready to be produced in times of emergencies.
- Did you know you need a Fixed Deposit Receipt (FDR) to withdraw your fixed deposit at maturity?
- An FDR is an essential document in a fixed deposit that banks or NBFCs provide as investment proof to investors.
- If you hold an FD, you must know the basic details about an FDR and its importance.
- Investors with multiple FD accounts with different tenures must need an FDR to keep track of all fixed deposit investments.