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From eligibility to features; all you need to know about SBI annuity deposit scheme

Mini

State Bank of India or SBI offers the option of opening annuity deposit account, in which a lump sum amount is deposited by an investor which is repaid to the customer over a period in equated monthly installment (EMI).

From eligibility to features; all you need to know about SBI annuity deposit scheme
State Bank of India (SBI) offers the option of opening an annuity deposit account, wherein a lump sum amount is deposited by an investor which is repaid to the customer over a period in equated monthly installment (EMI).
The EMI comprises part of principle amount and interest on the reducing principle amount, according to SBI. Using the scheme, customers can have a fixed monthly amount against their one-time deposit.
Here are key things to know about SBI's annuity deposit scheme:
Eligibility
The SBI annuity deposit scheme can be opened by all residents, including minors.
Investment limits
In no case, the minimum amount of deposit should be below Rs 25,000. However, there is no maximum limit of deposit amount for SBI's annuity deposit scheme.
Tenure and maturity
The annuity deposit scheme is available for 36 months, 60 years, 84 years and 120 years, according to SBI. Payment of annuity is done on the anniversary date of the month following the month of deposit.
If that date is non-existent (29th, 30th and 31st), it is paid on the 1st day of the next month. Annuity payment, net of TDS, is credited to linked savings/current account.
Interest rate
The rate of interest is the same as applicable to the fixed deposit (FD) account of the term opted by the person. The interest rate payable to SBI staff and SBI pensioners is, however, 1 percent above the applicable rate. The rate applicable to all senior citizens of age 60 years and above is 0.50 percent above the applicable rate.
Premature closure
Premature closure is permitted in case of death of depositor in annuity deposit scheme. Premature payment is also allowed for deposits up to Rs 15 lakh.
In special cases, overdraft/loan up to 75 percent of the balance amount of annuity is granted. After disbursal of OD/loan, further annuity payment is deposited in loan account only.
Premature penalty is chargeable as applicable to FD.
Disclaimer: CNBCTV18.com advises users to check with certified experts before taking any investment decisions.

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