Recurring deposits warning! Beware! Penalty will be imposed, this is how much
Recurring Deposit (RD) are one of the most important investment options open to investors. However, they should be aware that some nasty surprises can be in store for them if they fail to follow the rules. Yes, Recurring Deposits carry penalty charges. Notably, for those who want to know what Recurring Deposits are, then they should know that it is a product offering investors an opportunity to build up their savings. This happens through regular monthly deposits of fixed sum across a long time. Check out the Recurring Deposits Most Important Terms & Conditions as listed by the State Bank of India (SBI):
Recurring Deposit installment
1. Where the depositors fail to pay an installment for a calendar month, no reminders will be sent by the Bank. (Reuters)
Recurring Deposit penalty
2. Penalty charges for non-Deposit of monthly installments: (Reuters)
Recurring Deposit: Rs 1.50 for every Rs 100
3. Penalty in case of delay in payment of installment of RD of 5 years or less shall be Rs 1.50 for every Rs 100 per month. (Reuters)
Recurring Deposit: Rs 2 for every Rs 100
4. Such penalty shall be Rs 2.00 for every Rs. 100 per month for the account on more than 5 years. (Reuters)
Recurring Deposit: Default in payment
5. A service charge will be levied on Recurring Deposit accounts paid out on or after the date of maturity, wherein there is default in payment of three or more consecutive installments and the account has not been regularized. (Reuters)
Recurring Deposit: Service charge
6. A service charge of Rs.10/- will be levied on such accounts at the time of payment at or after maturity. (Reuters)
Recurring Deposit: Premature closure
7. In case six consecutive installments are not received, the account should prematurely be closed and balance paid to the account holder. (Reuters)
Recurring Deposit: Disposal of maturity
8. Instructions for disposal of maturity proceeds are accepted at the time of opening of accounts. (Reuters)