How to Close Fixed Deposit in SBI Online – A Complete Guide

Rajesh, an investor, opened a ₹1 crore Fixed Deposit with SBI for 2 years at an interest rate of 5.10% per annum. One year elapsed, and he had to withdraw the FD early due to some nature of the emergency. 

Being that his FD amount was above ₹5 lakh but below INR 1 crore, a penalty of 1% was imposed by SBI, effectively bringing down the effective rate of interest to 4.0% per annum (5.10%-1.00%). This naturally resulted in an unexpectedly low return, but these funds came to his aid in a critical period.

On October 26, 2023, the Reserve Bank of India developed a great interest in FD holders. The minimum for non-callable term deposits was increased to ₹1 crore from the previous point of ₹15 lakh. This allows the customers with FDs of up to ₹1 crore to prematurely redeem the funds if necessary, just like Rajesh was able to.

To close an SBI FD account, one may quickly log into the net banking portal or use the 'Yono' mobile app. The maturity proceeds are credited to the customer's savings account upon closure.

What is FD in SBI?

Fixed deposits with an SBI account are used to deposit money for a specific time at a certain interest rate with the bank. This is called a term deposit as well. The bank pays interest on the amount deposited, and after the maturity period, you receive the principal amount along with interest.

Bank fixed deposits are widely considered the best investment by conservative investors who wish to safeguard their money. These FDs can be fixed for a specific duration, extending from 7 days to 10 years.

Features offered by SBI FD

Here’s the information in a simple table format with explanations

Key Points to Consider Before Closing Your FD in SBI

When thinking of closing your SBI Fixed Deposit (FD), a few essential considerations may need to be kept in mind:

• Penalty Charges: For premature closure of an FD account, SBI may charge a penalty of up to 1% of the interest rate. More significant amounts (for example, from ₹5 lakh and above) may attract higher penalties.
  
  
• Interest Rate Effects: If you close the deposit early, you will be given interest only when the FD is operational. Otherwise, the interest was meant for a longer term, much higher than the actual rate you pulled out with.
  
  
• FD Terms: The FD certificate you hold is the primary document to check the penalty and terms for early closure.

• Closure Procedure: You may have to submit a closure form with the FD certificate in any SBI branch to initiate the closure.
  
  

• Joint Account Holders: All joint holders must sign for the closure.
  
  
• Alternatives: Rather than breaking the FD, check if you can take a loan against the FD to avoid penalties and access the funds.

Make a conscious decision as to whether you need access to the funds immediately, as prematurely breaking the FD will cost you.

Closing the FD on Maturity

At maturity, the deposit certificate, signed by all account holders, must be submitted along with a maturity and closure form of FD. The amount will thereafter be credited to your savings account.

You can either renew or close the FD upon maturity, whereby the maturity amount will be credited to your savings account.

Other than that, inaction by you would mean that one of the following courses of action would get taken by the bank for a matured FD

• Auto-renewal into a new FD for such, either for one year or for the original term.
• Auto liquidation, where the FD is closed, transfers the proceeds into your savings accounts.

Documents required to close FD in SBI

The following are the documents required for closing an SBI FD account:

• Certificate of Deposit: The FD certificate obtained from the bank must bear your signature.
• FD Closure Form: An appropriately completed form with your signature stating the reason for the FD closure.
• Saving Account Details: Saving account details where the FD amount is proposed to be transferred.
  
  

Important Notes

• In joint FD, all joint holders should sign the closure request.
• You may be required to give a reason for the closure of the FD.
• Sometimes, you may have to specify if you wish the money to be reinvested or withdrawn.

Charges on closing FD in SBI

If a Fixed Deposit is closed before the expiry of a minimum period, then a penalty is imposed by the State Bank of India.

Penalty

• 0.50% for deposits up to ₹5 lakh
• 1% for deposits above ₹5 lakh

Under what circumstances are penalties applicable?

• Penalties are applicable for early closure, irrespective of the FD tenure.
• The penalty is deducted from what would have been the amount of interest payable to the depositor.
• Penalty rules differ from bank to bank.
  
  

What FDs cannot be closed before maturity?

In SBI, Tax Saver FDs (or Tax Saving Fixed Deposits) cannot be closed before maturity. You must keep the deposit for 5 years, and trying to withdraw the money early will result in penalties and restrictions under the Income Tax Act.

Key Points About SBI Tax Saver FDs

• Lock-in Period: 5 years
• Premature Closure: Not allowed during the lock-in period
• Closure After 5 Years: You can close the FD only after the 5-year lock-in, and it must be done through your home branch.

What is the Premature withdrawal of FD in SBI?

SBI fixed deposit prematurely closed means it will be closed prior to completion of the maturity period, and it may include penalties. A penalty may be 0.50% on deposits below ₹5 lakh and 1% above ₹5 lakh. There may be a number of reasons for the premature closure- like an unforeseen emergency or cash crunch. However, the penalties incurred in such cases ought to be known. 

How to close FD in SBI?

Here’s the process of prematurely withdrawing an SBI Fixed Deposit (FD) in clear steps:

1. Visit the nearest SBI branch.
2. Ask for the premature withdrawal form at the branch.
3. Submit the form along with your Certificate of Deposit and required documents.
4. For joint accounts, all account holders must sign the paperwork.
5. After successful closure, you will receive a verification message on your mobile number or email ID.
6. The FD amount will be credited to your savings account.
7. If you have the auto-liquidation option, the entire FD amount will be credited to your linked bank account on maturity.

How To Close SBI FD Online Through Net Banking?

Here’s a step-by-step process on how to close SBI FD via SBI Bank Net Banking:

1. Visit the official website of SBI.
2. Click on ‘Login’ under Personal Banking for personal net banking or ‘Login’ under Corporate Banking for corporate net banking, according to your preference.
3. On the next page, click on ‘Continue to Login.’
4. On the login page, enter your username, password, and captcha, then click on ‘Login.’
5. You’ll be redirected to the homepage.
6. Select the ‘Deposit & Investment’ option.
7. Click on ‘Fixed Deposit.’
8. Choose the type of FD you want to close and click on ‘Proceed.’
9. Click on ‘Close A/c Prematurely.’
10. Select the FD account number you want to close.
11. The maturity amount will automatically be transferred to the debit account from which the FD was funded.

How To Close SBI FD Online Through YONO App?

1. Download the ‘YONO SBI: Banking & Lifestyle’ app from the Google Play Store or Apple Play Store.
2. Install the application on your device.
3. Open the app and enter your MPIN.
4. You’ll be redirected to the homepage.
5. Click on the ‘Deposits’ option.
6. Click on ‘Fix Deposits.’
7. All the details of the FD will be displayed on the screen.
8. Click on the FD that you want to close.
9. Click on the ‘Close Fixed Deposit’ option.
10. Confirm your request by clicking on ‘OK.’
11. Review the details and choose the account you want to credit your FD money.
12. Click on the ‘Confirm’ option.
13. Enter the OTP received on your registered mobile number and click on ‘Next.’
14. This is how you can close your FD in SBI via the app.

Customer Care Details

To close your SBI Fixed Deposit (FD), you can contact SBI's customer care at any of the following numbers:

• 1800-1234
• 1800-2100
• 1800-11-2211
• 1800-425-3800

For international calls, dial 080-26599990.

Other ways to contact SBI:

• You can email SBI’s customer care at customercare@sbi.co.in or contactcenter@sbi.co.in.
• To file a complaint, SMS "UNHAPPY SERVICES" to 8008202020.

Conclusion

It is very easy to close an SBI Fixed Deposit, be it online or through the branch. Depending upon how early you want to access your funds, SBI imposes a penalty that can reduce your interest rate. Ensure that all your documents, such as the FD certificate and a closure form, are ready. 

SBI also provides the opportunity to close FDs online through the mobile app and net banking for your convenience. Whether prematurely before maturity or at maturity, the more you know of the rules and the options you have, the better will be the management of your FD and the outcomes. 

FAQs related to How to close FD in SBI?

Q1: How long does it take to break an FD in SBI?

If you want to close your SBI FD instantly, you need to make the request between 08:00 AM and 08:00 PM IST through the SBI website. Any closure request made after 08:00 PM will be processed on the next working day.

Q2: How many FDs can be opened in SBI?

There is generally no strict limit on the number of Fixed Deposits (FDs) one can have.

Q3: What are the penalties for an early break of an FD?

Fixed deposits are, however, opened to early withdrawals if, and only if, it is of utmost necessity. Such early withdrawals usually attract a penalty of between 0.5% and 1% of the interest rate, which is collected ostensibly to compensate the bank for the lost interest due to closure of the FD.

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