Fixed deposits are a much sought-after investment option in India, especially amongst the retired citizens. It is, therefore, pertinent to ensure that the family members of the investor should be well versed with the claim process to avoid running from pillar to post in the event of the death of the deposit holder.
FD mode of operation
Fixed deposits can be held in different modes which need to be examined for a proper understanding of the claim process. The different modes are listed below:
- Option 1 (joint holding)
If the first holder dies, the surviving holder has to inform the company and submit the death certificate. Consequently, the company will delete the name of the deceased. The surviving person will, therefore, receive the maturity proceeds.
- Option 2 (joint holding)
If the first holder dies, the survivor can claim the deposit on maturity. If the second holder dies, the first holder can suggest another person of his or her choice.
- Option 3 (joint holding)
The deposit will be paid to the first holder when both the depositors sign on the FDR. However, in case of death of one of the depositors, the surviving depositor will receive the proceeds.
- Option 4 (single holding)
If the deposit is held in a single name while one or more persons are nominated, the maturity proceeds will be paid to the nominees as trustees.
- Option 5 (single holding sans nomination)
If the deposit holder dies, the survivors will have to produce a Will or a Succession Certificate to claim the proceeds.
Several companies in India offer attractive fixed deposit schemes such as ICICI Home Finance Company.
ICICI Home Finance Company Limited (ICICI HFC), one of the major leaders in the Indian mortgage finance sector, is promoted by ICICI Bank Limited, the second largest bank in the country. Fixed deposits of ICICI Home Finance Company Ltd. has a credit rating of CARE AAA. HFC’s public fixed deposit schemes are governed by regulations of the National Housing Bank.
Features and benefits
- Deposit tenure: 12 months (minimum) to 60 months (maximum)
- Maximum deposit amount is Rs. 50 million
- Annual/cumulative income plan- minimum Rs. 10,000
- Monthly income plan- minimum Rs. 20,000
- Quarterly income plan- minimum Rs. 40,000
- Interest: Monthly, quarterly, annual and compounded annually
- Nomination facility: Available
- Premature withdrawal: Allowed only after first 3 months
- Tax: No tax deduction at source on interest
- Eligible Depositors
- Resident Indians
- Trusts and Foundations
- Co-operative Societies
- Association of Persons (AOPs)
- Hindu Undivided Family (HUFs)
- Documentation Required
- Deposit Application form
- Form 15H
- Form 15G
- ECS Mandate Form
- Deposit Amount Cheque/DD
- For individuals, documents required are photo id proof, address proof and age proof for senior citizen deposits.
- For other entities, documents required are Certificate of Registration, Board/Managing Body Resolution and so forth
- Mobilization mode: Direct and brokers
- Interest rates offered for deposits greater or equal to Rs. 1 crore under different plans are listed below:
|Period (Months)||Cumulative Income Plan||Quarterly Income Plan||Monthly Income Plan|
- ICICI HFC’s fixed deposits are low risk investment option with assured long-term returns.
- Deposits can be made in joint names with three persons (maximum). The interest on deposits will, however, be paid to the first depositor. Deposits in the name of a minor will be accepted if he or she is represented by his guardian.
- For renewals, fixed deposit can be minimum of Rs. 5,000 while any additional amount will be in multiples of Rs. 1. Fixed deposit applications can be accepted at ICICI HFC retail offices.
- Interest earned up to Rs. 5,000.00 in a year is tax exempted. Also, deposits by trusts fall in the category of Specified Investment of the IT Act 1961.
- Loan facility is available only to individuals (except minors and NRIs) HUFs and corporates after the first three months for up to 75% of the deposit amount. Interest on such loans will be 2% above the deposit rate.