PNB limits investment in '0 premature withdrawal penalty' Sugam FDs to Rs 10 lakh 10 lakh
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PNB hikes FD interest rates by up to 30 bps; check latest fixed deposit ratesPunjab National Bank (PNB) has decided to restrict the maximum amount of investment at Rs 10 lakh per customer under PNB Sugam Fixed Deposit Scheme.What happens to the existing Sugam deposits?
“In case of existing Sugam Fixed Deposit a/c holders who mandated for auto-renewal of their FD on maturity, the same shall be done for the mandated tenor at the prevailing rate of interest," the bank said.
"However, due to modification of the scheme, the amounts which are more than Rs.10 Lacs at the time of maturity will be renewed under a different fixed deposit scheme of the bank," the bank said.
Who can invest in the PNB Sugam deposit scheme?
• Individual (singly or jointly) with others• Minor who have attained the age of 10 years and above in his name on giving proof of age
• Proprietorship/Partnership Firm, Commercial Organization, Company /Corporate Body
• Hindu Undivided Family
• Association, Club, Society, Trust or Religious/Charitable or Educational Institutions
• Municipality or Panchayat, Government or Quasi Government Body
• Illiterate and blind persons can also open the account
Minimum deposit amount
The minimum deposit for the PNB Sugam deposit is Rs 10,000 and thereafter in multiple of Rs 1.
PNB Sugam Term Deposit: Period of Deposit
For any period from 46 days to 120 months, even for incomplete quarters, such as 13 months, 14 months, 37 months & 16 days, and so on., for a deposit of up to Rs10 crore.
The period of deposit can be from 46 days to 36 months even for incomplete quarters, for deposits above Rs10 crore to less than Rs. 100 crores
Premature withdrawal of deposit
The main advantage of the plan is that the depositor has the option to withdraw any amount before maturity in multiples of Rs 1 with a minimum withdrawal of Rs. 1000, whenever he needs it, without having to break the entire deposit or forfeit interest on the balance of the plan deposit.
Accordingly, the value of the term deposit principal amount will be decreased. Also, there will be no penalty for the partial withdrawal of the deposit. The interest rate payable would be the contractual rate or the rate under the scheme on the contractual date applicable for the duration for which the deposit has run, whichever is lower if any depositor wishes to remove the full deposit before maturity.
Interest rate
The rate of interest on the deposit shall be as per the amount bucket of the deposit which are:
a. Deposits less than Rs 2 crore
b. Deposits for Rs 2 crore to Rs 10 crore
c Deposits for above Rs 10 crore to less than Rs 100 crore
According to the PNB website, “If the amount bucket of the deposit changes due to part withdrawal of deposit, then rate as applicable for new amount bracket of deposits is to be made applicable from the date of such withdrawal.”
The depositor can choose to cash out interest on a monthly, quarterly, or annual basis. Interest shall be paid on a compounded basis with quarterly rests if the period of deposit remaining with the Bank is 6 months and above.
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This story originally appeared on: India Times - Author:Faqs of Insurances
