Fixed Deposit Receipt (FDR)
Applicants can procure Fixed Deposit receipt by visiting their bank or even on their bank’s website as many banks have enabled the facility of providing fixed deposits online. Once applicants apply for their FD scheme and all formalities are complete, they will receive a fixed deposit receipt as an acknowledgment. This is an important document and should be kept safely.
What is a Fixed Deposit Receipt?
A Fixed Deposit Receipt (FDR) is nothing but a document provided by the bank after the applicant procures a FD scheme from their bank. This document contains details such as the individual’s name, age, address, details of the scheme chosen by them such as deposit amount, tenure and interest rate applicable on the deposit and so on.
What are the Components and Importance of a Fixed Deposit Receipt?
A Fixed Deposit Receipt contains all the details related to the deposit option procured by the individual. These details include:
- Name of the applicant
- Age of the applicant
- Account Number of the applicant
- Amount of principal that has been placed
- Rate of Interest that is applicable
- Date of Maturity
- Amount of interest that the individual will receive on maturity
- Instructions regarding maturity date such as account transfer or rollover amount
The Fixed deposit receipt acts as an acknowledgment and proof of the ownership of the FD account by a particular individual.. Apart from this, this receipt contains every single detail pertaining to the fixed deposit such as interest applicable, term and so on. Hence this receipt is a very important document and must be in the possession of the applicant.
Things to Check in a Fixed Deposit Receipt
When individuals receive their Fixed Deposit Receipt, the following are the things that they need to check for:
- Term and interest rate offered – Although this is a basic component of the receipt and may already be known to the customer, it is important to check these details again. This has to be given priority especially when individuals are renewing their FD scheme as certain rates may be discontinued by the bank.
- Auto renewal and date of maturity – It is convenient for individuals to opt for auto renewal if they have a guaranteed salary every month as it saves on hassle and time during the next renewal. Also, date of maturity is another detail that should not be missed by individuals as this will help them plan out their financials better and also with regard to the day they can withdraw their fixed deposit investment.
- Penalty for Prepayment – Banks sometimes charge a penalty on their fixed deposit if prepayment has been done. For example, if a bank charges 1% as the penalty for prepayment and individuals withdraw their fixed deposit (valued at 9%) after a period of 6 months, then they will receive an interest rate of only 6%, assuming the bank provides 7% as the interest for a 6 month FD.
- Nomination – The receipt must provide details of the nomination in case the individual has made one. In the event of the unfortunate death of the individual, his/her nominee will receive the proceeds of the fixed deposit.
- Declaration to save TDS – Tax at source is deducted by the bank in case the income from interest is over Rs.10,000. In case an individual’s income falls into the bracket of ‘no income tax’ then declaration through Form 15G or Form 15H can be submitted and this must be mentioned in the receipt.
