SBI Multi-Option Deposit Scheme: From Interest Rate To Tenure, All Explained Here
State Bank of India's multi-option deposit scheme (MODS), a type of fixed deposit (FD) or term deposit scheme, is linked to the savings or current account of an individual. A fixed deposit is a secure financial instrument offered by banks, which fetch guaranteed returns. Unlike normal fixed deposits which are fully liquidated anytime you need funds; you can withdraw in multiples of Rs 1,000 from MODS account, according to your need, mentioned State Bank of India (SBI) on its corporate website- sbi.co.in.
(Also read:Â SBI Public Provident Fund (PPF) Account: How To Invest, Interest Rates, Tax Benefits)
Here are key things to know about SBI's multi-option deposit scheme (MODS):
Minimum/maximum investment
The minimum term or fixed deposit amount needed for MOD creation is Rs 10,000. Any deposits above this amount are required to be in multiples of Rs 1,000. However, there is no limit for a maximum term deposit amount for MOD creation, according to country's largest lender's website.
Tenure
For SBI's multi option deposit scheme, the minimum tenure is one year and the maximum tenure is five years.
(Also read: What Is SBI Annuity Deposit Scheme? Key Things To Know)
Interest rates
SBI pays the same interest on a multi option fixed deposit account as on a fixed deposit account. SBI revised its interest rates on retail fixed deposits with effect from November 28, 2018. The following FD interest rates are for deposits below Rs. 1 crore:
| Tenors | Revised For Public w.e.f. 28.11.2018 | Revised for Senior Citizens w.e.f. 28.11.2018 |
|---|---|---|
| 1 year to less than 2 year | 6.8 | 7.3 |
| 2 years to less than 3 years | 6.8 | 7.3 |
| 3 years to less than 5 years | 6.8 | 7.3 |
(As mentioned on SBI's website)
Tax Deducted At Source (TDS)
Tax deducted at source (TDS) is applicable on SBI's multi option deposit scheme. The government has in Interim Budget 2019-20 proposed to increase the limit for tax deduction at source (TDS) on interest income earned on bank deposits from Rs 10,000 to Rs. 40,000 per annum. The proposed change in TDS rules will come into effect from April 1, 2019.
Premature withdrawal
Premature withdrawal is allowed in SBI's multi option deposit account. Rules of premature withdrawal of a fixed deposit (FD) account are applicable on the multi option deposit account, mentioned SBI.
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