Benefits of Canara Bank Fixed Deposit Schemes
Canara Bank offers Fixed Deposit (FD) schemes tailored for various financial needs, providing competitive interest rates, flexible tenures, and options for regular or cumulative interest payouts. Here’s a deep dive into the key aspects, features, and benefits of Canara Bank’s FD schemes:
Canara Bank FD Interest Rate
1. Types of Fixed Deposit Schemes
- Canara Bank Regular Fixed Deposit: Offers a fixed rate of interest over a specific tenure. Ideal for individuals looking to secure steady returns.
- Canara Tax Saver FD Scheme: A tax-saving deposit with a 5-year lock-in period, allowing tax deduction under Section 80C of the Income Tax Act, 1961.
- Canara Kamadhenu Deposit (Reinvestment Plan): Interest is compounded quarterly and reinvested, providing higher returns at maturity.
- Canara Ashraya Deposit Scheme for Senior Citizens: Offers additional interest for senior citizens and is designed for their unique needs, providing regular income options.
- Canara Dhanvarsha FD Scheme: Special short-term deposit schemes with competitive interest rates, typically ranging from 7 to 14 days.
2. Interest Rates
- Interest rates for FDs typically vary by tenure, deposit amount, and customer type (e.g., regular or senior citizen).
- Regular Deposit Rates: Rates range from around 3% to 7.50% per annum, with better returns on longer tenures.
- Senior Citizen Rates: Senior citizens typically receive an additional 0.50% interest rate across all tenures.
- Tax Saver Rates: Fixed for 5 years, offering competitive returns comparable to long-term FDs.
Note: Interest rates fluctuate based on the Reserve Bank of India (RBI) guidelines and economic conditions.
3. Minimum and Maximum Deposit Amount
- Minimum Deposit: ₹1,000 for most FDs (may vary for specific schemes like Dhanvarsha).
- Maximum Deposit: No upper limit for regular FDs. However, tax-saver deposits have a maximum cap of ₹1.5 lakh per year (under Section 80C).
4. Tenure Options
- Canara Bank FDs offer flexible tenure options ranging from 7 days to 10 years. You can choose the period based on your financial goals.
- Premature Withdrawal: Available on most FDs except for the Tax Saver FD (due to lock-in), but may come with penalties (usually around 1%).
5. Interest Payout Options
- Cumulative Option: Interest is compounded quarterly and paid at maturity, resulting in higher returns.
- Non-Cumulative Option: Allows for monthly, quarterly, half-yearly, or yearly interest payouts, ideal for those needing regular income.
6. Tax Implications
- Interest earned from Canara Bank FDs is taxable as per your income tax slab.
- Tax Deducted at Source (TDS): TDS is deducted if the interest earned exceeds ₹40,000 (₹50,000 for senior citizens) in a financial year.
- For tax-saver deposits, you can claim deductions up to ₹1.5 lakh under Section 80C.
7. Features and Benefits
- Loan/Overdraft Facility: You can avail a loan or overdraft of up to 90% of the deposit amount, depending on the FD type.
- Nomination Facility: Nomination can be set up to ensure ease of inheritance.
- Auto-Renewal: Allows automatic renewal upon maturity, reducing the need for manual renewal.
- Online and Offline Opening: FDs can be opened at a Canara Bank branch or through online banking.
8. Eligibility
- Individuals, joint account holders, minors (with guardian), HUFs, firms, and NRIs can open an FD account.
- NRIs have the option to open FDs under FCNR, NRE, and NRO schemes with varying benefits.
9. Application Process
- Offline: Visit a Canara Bank branch with identity proof, PAN card, and other KYC documents.
- Online: Canara Bank’s net banking or mobile banking app provides an option to open FDs digitally with an existing savings account.
10. Current Rates and Promotions
For the latest interest rates and special FD schemes, it is recommended to check Canara Bank’s official website or contact the branch, as rates may change periodically.
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