RBI has issued a circular by changing the rules related to FD, in which interest can be reduced.
The Reserve Bank of India (RBI) has made a major change in the rules regarding fixed deposits. This will give you less interest on your FD. With this new rule, now you may have to bear a loss of up to 3-4 percent.
Now you have to prepare before getting FD. Even a small mistake in this can cost you a lot in interest. Usually, once the customer has made an FD, if he does not claim it, then the bank increases that FD again. But now if you have taken an FD and do not claim or proceed after its maturity, then the bank will not proceed on its behalf.
Maturity rules change
RBI has said in its circular that customers who take FD. After this, if you do not claim on maturity, then now the bank will be paid on the basis of the interest going on in the savings account on that FD. It means to say that whatever interest will be received will be available on the basis of savings account which is very less. This new rule will be applicable to all commercial banks, small finance banks, government banks and regional banks.
How will it hurt
People make FDs because they get more interest. But now the pockets of the public are sure to be cut. The interest earned in a savings account is usually 3-4 per cent. Whereas on FD it is available above 5 percent.
Rollover rule changed
Earlier, when your FD was mature, then this FD was rolled over if it was not updated after that. The bank automatically extended your FD for the same period. But now it will not happen. If you do not withdraw money on maturity, you will not get FD interest on it. So it would be better if you withdraw this amount after maturity or renew it as FD.
