State Bank of India (SBI), the largest lender of the country, offers annuity deposit account, a variant of fixed deposit or term deposit. The account enables the depositor to pay a one-time lump sum amount and receive the same in equated monthly instalments (EMIs), comprising a part of the principal amount as well as interest on the reducing principal amount, according to bank's website -- sbi.co.in. The amount is compounded at quarterly rests and discounted to the monthly value, according to SBI. A nomination facility is also available with the scheme.
Here are key things to know about SBI's annuity deposit account:
1. Amount: Under SBI's annuity deposit account, the minimum amount of deposit is Rs. 25,000. However, there is no maximum limit of deposit amount for this scheme.
2. Tenure: A term of 36 months, 60 months, 84 months or 120 months (3 years, 5 years, 7 years or 10 years) is available for SBI's annuity deposit account scheme.
3. Rate of Interest: The rate of interest charged is same as applicable to the fixed deposit account of the term opted by the depositor. The following FD interest rates are for deposits below Rs. 1 crore:
| Term | Interest rate for general public w.e.f. 30.07.2018 | Interest rate for senior citizen w.e.f. 30.07.2018 |
|---|---|---|
| 3 years to less than 5 years | 6.8 | 7.3 |
| 5 years and up to 10 years | 6.85 | 7.35 |
4. Premature payment: Under this kind of fixed deposit account, premature payment is permitted only in case of death of depositor, said SBI on its website.
5. Loan facility: Overdraft/loan up to 75 per cent of the balance amount of annuity can be granted on special cases, stated SBI. After disbursal of /loan, further annuity payment is deposited in loan account only.
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