Procedure to close a fixed deposit before maturity and after maturity.

Closing a fixed deposit before the maturity date will give you a lesser effective interest rate than the one that is advertised as banks will deduct a specific charge before handing out the entire sum that is due as your maturity amount. In order to close a fixed deposit prematurely, you’d need the deposit certificate as proof. The original certificate is always a good idea and you could always have photocopies of the same. In case the original certificate is lost or misplaced, you can fill up the relevant premature FD closing form at the bank.

➲The process to close a fixed deposit prematurely is simple:

You need to submit your Fixed Deposit advice( or certificate, receipt) duly signed by all account holders, at the branch for premature liquidation. In the absence of your Fixed Deposit advice, you need to submit the Fixed Deposit Liquidation form.

If booked through Net Banking, banks allow you to do premature withdrawal through Net Banking also.

➥After maturity:

A fixed deposits get renewed automatically if not withdrawn on maturity or the interest rate of savings account is paid for period after maturity. Therefore, while opening an FD, you have 2 options:

• After maturity the amount be transferred to a specific savings bank account. The account number and bank details should be provided.
• Second, the depositor can indicate in the form that the amount be renewed after maturity. The longest tenor for an FD is 10 years.

So if you select the first option while you open an FD, the FD amount will be automatically credited after valid deductions in the appropriate savings account.

If the second option is chosen, the matured amount will be reinvested as an FD with a similar tenor of the previous FD and at the same rate of interest. Investors can choose perpetual or a set number of renewals as well.