Loan against Fixed Deposit 

During any financial emergency, availing of a loan can be one of the quickest modes of financial aid. However, getting a loan is not easy. Lenders have a detailed eligibility criteria which must be fulfilled to get a loan. In such a case, if you have a Fixed Deposit (FD), you can apply for a loan against FD. To get a loan against your FD, you don’t need to have an excellent credit score or monthly income. The interest rate on such loans vary from 1% to 2% above the FD rate and repayment tenure can be up to 60 months.

Loan Against Fixed Deposit

Loan amountUp to 90% of principal and accrued interest
Rate of interest1% to 2% above the FD rate
Repayment tenure  Up to 60 months
SecurityCollateral security of fixed deposit 
Nature of facilityDemand Loan and Overdraft facility

Benefits of Loan on Fixed Deposit

Key benefits of loan against FD are mentioned below:

  • The loan processing is very simple since you are holding the fixed deposit of the bank.
  • Documentation is minimal
  • Your fixed deposit will continue to earn the interest.
  • Can get the funds instantly
  • Loan against FD interest rate is lower than personal loan interest rate.
  • No processing fees
  • No prepayment charges

Top Banks Offering Loan Against Fixed Deposit

Here are some of the top banks that offer loan against fixed deposit:

  • State Bank of India
  • Axis Bank
  • HDFC Bank
  • Punjab National Bank
  • ICICI Bank
  • Citibank
  • Deutsche Bank

SBI Loan Against FD

State Bank of India Loan Against NRO/NRE/FCNR(B) 

Key features:

  • Eligibility: Customers (single/joint account holders) holding SBI's NRO/TDR/STDR/RD deposits can avail this loan. The single account holder can also avail overdraft online through Internet banking platform.
  • Nature of facility: Demand Loan or Overdraft facility
  • Quantum of loan: Up to 90% of principal and accrued interest.
  • Rate of Interest: Loan against FD interest rate SBI is 1% above the relative fixed deposit rate.
  • Security: Lien in favour of the bank will be marked on the fixed deposit and custody of the Deposit Receipt duly discharged will be with the bank.
  • Repayment: Repayment tenure up to the remaining period of maturity. You can use a loan against FD SBI calculator to know your EMI. You can also calculate EMI with our tool.

State Bank of India Loan Against NRE/TDR/e-TDR/STDR/e-STDR/RD 

Key features:

  • Eligibility: Customers (single/joint holders) holding SBI NRE/TDR/e-TDR/STDR/e-STDR/RD can avail this loan on FD SBI.
  • Nature of facility: Both Demand Loan and Overdraft facility
  • Quantum of loan: 90% of principal and interest of the fixed deposit pledged for the loan. The loan will be in Indian rupees only and can be availed from home branch in India.
  • Repayment: Repayment tenure is up to the remaining period of maturity.
  • Security: Collateral security of fixed deposit. Lien will be marked in favour of the bank. Custody of the Fixed Deposit Receipt duly discharged will be with the bank.
  • Interest: Interest rate for this loan on fixed deposit SBI is 1% above the rate earned on the fixed deposit.

SBI Loan Against FCNR(B) TDR/STDR

Key Features:

  • Eligibility: Customers (single/joint holders) holding SBI FCNR(B) TDR/STDR deposit can avail the loan.
  • Nature of facility: Demand Loan, Overdraft facility, and Foreign Currency loan. The facility for the creation of overdraft facility online is not available.
  • Quantum of loan: Minimum of USD 25000, GBP 15000, and EURO 20000. There is no maximum limit. Loan up to 90% of notional rupee value of foreign currency deposit and accrued interest.
  • Repayment: For Indian Rupees, tenure is up to the remaining period of maturity. For foreign currency loan, 1, 2, 3 years or up to the remaining period of maturity with a minimum of 1 year. Repayment can be done by adjusting the underlying deposit only on maturity or by fresh inward remittance or through NRE/NRO account. The maximum repayment from NRO account will be within the cap of USD 1 million in a financial year.
  • Interest: This loan against fixed deposit SBI comes at interest rate 50% over prevalent FCNR(B) deposit rate for the relative period at the time of processing of the loan.
  • Security: Collateral security of FCNR(B) deposit. Lien will be marked in favour of the bank and custody of the FCNR(B) deposit duly discharged will be with the bank.

Axis Bank Loan Against Fixed Deposit

Key features:

  • Eligibility: Customer holding an Axis Bank Fixed Deposit can avail loan against FD Axis Bank.
  • Nature of facility: Overdraft facility. Cheque book and ATM card will be issued for the overdraft account.
  • Quantum of loan: 85% of the value of the maximum with a minimum of  25,000
  • Interest: Interest will be charged at 2% above the maximum rate
  • Tenure: There is no specific tenure. The maximum should be in force. You have the facility to repay the loan during the time period.
  • Security: Collateral security of the maximum lien will be marked in favour of the bank.
  • Rates and charges: 
FacilityCharges
Cheque book issuanceRs. 100 + GST
Penal Interest2% p.m. + GST
Clearing cheque return-Issued by CustomerRs. 500 to Rs. 750 + GST per instance
Clearing cheque return-deposited by CustomerRs. 100 + GST
Pre-payment chargesNil

HDFC Loan Against FD 

Key Features:

  • Eligibility: Resident Individuals (sole or joint account), Hindu Undivided Family, and Private and Public Limited Companies holding an HDFC Bank Fixed Deposit are eligible for the loan against FD HDFC.
  • Quantum of loan: 75% to 90% of the value of the FD. Overdraft limit will be set up only on NRO CASA Account.
  • Interest: 2% above the maximum rate to the extent of the amount utilised and for the period utilised.
  • Repayment: In case of overdraft against FD/Super Saver Account, if the overdraft is not cleared before the maturity of the deposit, the deposit will be renewed automatically for the same period at the prevailing rate. You can use loan against FD HDFC calculator to know your EMI.

PNB Loan Against Fixed Deposit 

Key Features:

  • Eligibility: Customers holding (single or joint account) a Punjab National Bank Fixed Deposit will be eligible for the loan against FD PNB. PNB grants loan against third party deposit also. The loan will be granted against Rupee Term Deposit/NRE/NRO/FCNR deposits.
  • Nature of facility: Term Loan and Overdraft Facility
  • Quantum of loan: 70% to 95% of the value of the fixed deposit
  • Interest: Up to 2% above the fixed deposit rate with a minimum up to MCLR.
  • Security: Collateral security of fixed deposit. Lien will be marked on the deposit and custody of the deposit receipt duly discharged will be with the bank.
  • Repayment: No specific tenure. The tenure for loan on FD will be in line with the residual maturity period of the fixed deposit.

Online Overdraft Facility Against Fixed Deposits

Key features:

  • Eligibility: Customers using Retail Internet Banking Service
  • Quantum of Loan: Minimum Rs. 25,000 and maximum Rs. 5 Crores in case of Sugam Deposit and a maximum below  1 Crore in case of other deposits.
  • Loan period: The maximum loan period under loan against fixed deposit is 3 years or the residual maturity period of the deposit whichever is lower.
  • Eligible fixed deposits: Fixed deposits in the name of the borrower having a residual maturity period of 3 years. Tax Saver and Capital Gains deposits are not eligible. 
  • Margin: 5% to 7.5%.
  • Interest: Up to1% above the fixed deposit rate

ICICI Bank Loan Against Deposits

Key features:

  • Eligibility: Customers holding NRE/NRO/FCNR deposit of ICICI Bank. A loan will be granted either in the name of the borrower or third-party individuals (any individual/corporate).
  • Nature of facility: Loan against FD ICICI is available as Demand Loan and Overdraft facility
  • Quantum of loan: 90% of the principal amount of the deposit with a maximum of  5 Crores
  • Repayment: Repayment should be made either by adjustment of the fixed deposit or by fresh inward remittance through normal banking channels. The loan can also be repaid through the funds in the NRO account of the borrower. In case of a loan to a third party, repayment can be made through local rupee account of the borrower.
  • Security: Collateral security of the fixed deposit. Lien will be marked on the deposit in favour of the bank.
  • Interest: As per prevalent guidelines of the bank at the time of availing the loan on fixed deposit.

Citibank Loan Against Fixed Deposit

Key features:

  • Eligibility: Resident individuals above 21 years of age, Private Limited Companies, Sole Proprietorship/Partnership firms, closely held Public and Private Limited Companies, and Stock Brokers can avail a loan against fixed deposit. Holding a fixed deposit of Citibank is mandatory. Applicants can avail loan against fixed deposit held in the name of members of the same household.
  • Nature of facility: Overdraft facility
  • Quantum of loan: 90% of the value of the deposit with a minimum of Rs. 1 Lakh
  • Interest: Competitive rate prevailing at the time of availing the loan
  • Repayment: Tenure should not exceed the maturity period of the fixed deposit
  • Security: Collateral security of the fixed deposit. Lien will be marked in favour of the bank.

Deutsche Bank Loan Against Fixed Deposit

Key features:

  • Eligibility: Customers holding a fixed deposit of Deutsche Bank. A loan will be granted on the fixed deposits in the name of any of the family members, relatives or friends.
  • Nature of facility: Overdraft facility
  • Quantum of loan: Up to 95% of the fixed deposit amount with a minimum of Rs. 25,000
  • Interest: Interest will be charged at 2% above the fixed deposit rate. Interest will be charged only on the amount utilised.
  • Tenure: Tenure will be linked to the tenure of the fixed deposit
  • Security: Collateral security of the fixed deposit. Lien will be marked in favour of the bank.
  • Fees and charges:
    • Interest at 24% p.a. will be charged on the overdrawn amount if the overdraft facility is utilised over and above the limit set for the account.
    • GST payable on fees and charges will be as applicable
    • Stamp duty charges will be as per local regulations

Loan Against Fixed Deposit Disadvantages

Below are some loan against fixed deposit disadvantages:

  • If you fail to repay the loan, the lending bank is authorised to foreclose your FD to recover their money.  
  • The repayment tenure of the loan on FD cannot exceed the remaining tenure of your fixed deposit.
  • Loan on fixed deposit does not offer tax benefits.

Kotak Personal Loan Festival Offer 

Ahead of festival season, Kotak Mahindra Bank has announced Rs 999 flat processing fee offer on Personal Loans. Customers can avail of instant approvals on personal loan applications up to Rs. 20 Lakhs at lowest interest rate starting at 10.25% p.a for maximum of 5 years. 

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Loan against Fixed Deposit FAQs

Who is eligible to avail loan against fixed deposit at SBI?

Individual customers holding TDR/STDR/e-TDR/e-STDR with SBI in a single name only can avail the facility online. Joint account holders can avail the facility at the branches. At branch level loan is also sanctioned against the security of RD/NRE/NRO/RFC and FCNR(B) deposits.

What is the security that the customer has to offer?

The deposit against which the loan will be availed has to be offered as collateral security to the bank. Lien will be marked on the deposit in favour of the bank and custody of the fixed deposit receipt duly discharged will be with the bank.

Is Demand/Term Loan facility available online?

At present, the online facility is restricted to Overdraft only. For availing Demand Loan, the customer has to visit the branch.

What is the extent of the Overdraft facility available?

Overdraft facility up to 90% of the value of STDR/e-STDR and up to 75% of the value of TDR/e-TDR can be availed on the internet platform. At branch level, you will be able to avail 90% of the underlying security as either Overdraft facility or Demand Loan.

What is the current rate of interest on the scheme?

Interest will be charged at 1% above the relative time deposit rate.

What is the maximum Overdraft limit?

The maximum Overdraft limit that can be availed against the fixed deposit is  5 Crores, if availed online. There is no specific limit for advances at the branch level.

Is there any minimum amount specified for availing Overdraft facility?

The minimum loan amount is  25,000 if the overdraft facility is availed online. There is no specific minimum limit for advances at the branch level.

Can the overdraft facility be availed in joint names?

For availing overdraft facility online, customers holding TDR/STDR/e-TDR/e-STDR in with SBI in a single name are only eligible. If the Overdraft facility has to be availed jointly, the joint account holders have to visit SBI branches for availing the facility.