Terms and Conditions of Domestic Term Deposit (Fixed Deposit) in Indian Rupees for Corporate Clients – Residents of India
1. GENERAL PROVISIONS
A Term Deposit is an interest bearing deposit received by Sberbank, Branch in India (hereinafter referred to as the “Bank”) for a fixed period. Term Deposit Accounts can be opened by Proprietorship firms / Partnership firms / Private and Public Limited Companies / Specified Associates / Societies / Trusts, Departments of Authority created by Government (Central or State), Limited Liability Partnerships, etc.
A Fixed Deposit is a type of Term Deposit that can be withdrawn after a certain period of time – the tenor of the deposit – on the maturity date, rather than on demand.
The Fixed Deposit is provided with a fixed maturity, with the tenor from 7 (seven) days to 10 (ten) years (inclusive). The interest rate depends on the amount and tenor of the Fixed Deposit (https://sber.bank.in/customer-information/tariffs-and-conditions). The interest amount is paid on the maturity date, except for premature partial withdrawal – in this case, the interest amount related to the prematurely withdrawn principal amount is paid on the date of premature withdrawal.
The minimum amount for opening the Fixed Deposit Account is INR 10,000.00 (Ten thousand Indian rupees).
The replenishment of the Fixed Deposit Account after value date is not available.
Auto-renewal option can be applied to the Fixed Deposit Account.
Fixed Deposit can be renewed for the similar period in accordance with the maturity instructions.
The renewed Fixed Deposit will earn the interest rate prevailing on the date of maturity.
There are two scenarios for the Fixed Deposit auto-renewal:
1) auto-renewal option for both principal amount and interest amount;
2) auto-renewal option only for the principal amount.
Fixed Deposit Advice will be sent to the Depositor for every renewal.
If the Fixed Deposit matures on Sunday / holiday / non-working day the principal amount of the deposit and the interest amount will be paid on that day.
The account opening form, constituent and title documents, other required documents along with Fixed Deposit Account request letter should be furnished by the prospective Depositor. It is expected of the Bank official opening the account to explain the procedural formalities and provide the prospective Depositor with necessary clarification when opening a Fixed Deposit Account. If the Depositor is an existing customer of the Bank, then only the Fixed Deposit Account request letter (duly signed and stamped) is submitted. The Fixed Deposit Account request letter contains the field related to the nomination. If the customer indicates “Yes” in this field, the Nomination Form for nomination, cancellation of nomination and variation of nomination should be filled out.
The facility of Fixed Deposit Account opening for the existing customers of the Bank is also implemented in Internet Banking (https://online.sber.bank.in/) under the following conditions:
- The minimum amount is INR 1,000,000.00 (One million Indian rupees),
- The maximum amount is INR 250,000,000.00 (Two hundred and fifty million Indian rupees),
- The tenor is up to 365 days (inclusive),
- The purpose is savings. To open collateral Fixed Deposit Account the physical form of the Fixed Deposit Account request letter signed by the authorized signatory(ies) should be submitted to the office of the Bank.
The Bank before opening any deposit account will carry out due diligence as required under “Know Your Customer” (KYC) guidelines issued by RBI and Prevention of Money Laundering Act and / or such other norms or procedures as per extant KYC Policy of the Bank.
Nomination facility is available on all deposit accounts opened by sole proprietors and one person companies. The Depositor understands and acknowledges the risk and consequences associated with not nominating. The Depositor is responsible to the Bank in case of any claim raised against the Bank acting in accordance with the instruction of nomination, and the Depositor will indemnify the Bank for any losses incurred.
Disclosure of nominee names in the Bank documents to the Depositor is strictly conditional upon an explicit written request submitted by the Depositor. In the absence of such a specific demand, all nominee identities shall remain confidential.
The Fixed Deposit Account may be opened for the purpose of savings or as collateral for fund based / non-fund based credit facility. Fixed Deposit Account is not allowed to be closed in case any lien is marked on this Fixed Deposit. If removal of the lien is approved, the lien will not be marked on Fixed Deposit Account.
Fixed Deposit cannot be pledged to avail direct or indirect credit facility from other institutions.
2. INSURANCE
All deposits are covered under the insurance scheme offered by the Deposit Insurance and Credit Guarantee Corporation of India (DICGC), subject to certain limits and conditions. The details of the insurance cover in force will be made available to the Depositor.
3. TDS (TAX DEDUCTED AT SOURCE)
Interest earned on Fixed Deposits is subject to TDS as per the prevailing income tax laws. The Bank will deduct TDS at the applicable rates if the interest income exceeds the threshold limit specified by the Income Tax Department.
The Bank has statutory obligation to deduct tax at source if total interest paid / payable on all term deposits held by a person exceed the amount specified under the Income Tax Act. The Bank will issue a tax deduction certificate (TDS Certificate) for the amount of tax deducted once a year after the end of the financial year. The Depositor, if entitled to exemption from TDS, can submit declaration in the prescribed format at the beginning of every financial year.
The Depositor is recommended to register his a PAN for all Bank Accounts. If the PAN has not been registered with the Bank, the Depositor can furnish a self-attested copy of PAN card to the office of the Bank, by mentioning Account number for registration. Original PAN card can be submitted for verification by the Bank official. PAN is essential to keep accounts active. TDS at a higher rate (as per Income Tax Act / Rules) would be deducted if the PAN is not registered for the account.
In case of sole proprietor Fixed Deposits the interest income of deposits in the name of the business unit and in the individual name would be clubbed to arrive at the TDS applicability.
For the purpose of TDS calculation, the deposits held by the Depositor at all the offices of the Bank would be considered. TDS shall be deducted at end of the time of maturity of Fixed Deposits or 31st March of the year, whichever is earlier.
4. INTEREST PAYMENT
Fixed Deposit interest rates are decided by the Bank within the general guidelines issued by the Reserve Bank of India from time to time (Reserve Bank of India (Interest Rate on Deposits) Directions). The rates shall be uniform across all branches and for all Depositors and there shall be no discrimination in the matter of interest paid on the deposits between one deposit and another of similar amount, accepted on the same date, at any of offices of the Bank.
Interest on the Fixed Deposits is determined at the rates published on the official website of the Bank on the value date and is paid on the maturity date (according to the formula of simple percentages):
1. The interest rate depends on the amount and tenor of the Fixed Deposit.
2. Interest accrual is on daily basis.
3. The Bank adopts the method of reckoning the year at 366 days in a leap year and 365 days in other years.
4. The interest amount shall be rounded off to the nearest rupee.
5. The interest amount is determined by the formula: Interest amount = Fixed Deposit principal amount * Interest rate * Fixed Deposit tenor (days) / Actual number of days in a year.
5. PREMATURE PARTIAL WITHDRAWAL AND PREMATURE CLOSURE
Premature partial withdrawal and premature closure are only available for callable Fixed Deposit Accounts.
Non-callable Fixed Deposits cannot be closed before expiry of the tenor. Premature withdrawal is not permissible (except in cases of bankruptcy / winding up / directions by court, regulators, receiver, liquidator / death of the Depositor). Premature closure in above mentioned exceptional cases will lead to a change in the Fixed Deposit interest rate.
The Depositor should submit duly signed and stamped request on the letterhead mentioning complete details of Fixed Deposit Account to be closed prematurely. The Fixed Deposit Account can be closed prematurely on a business day only.
In case of premature partial withdrawal or premature closure of the Fixed Deposit, interest will be calculated based on the interest rate applicable for the period for which the Fixed Deposit remained with the Bank, at the lower of two rates, less a premature closure penalty (as a percentage per annum in accordance with the Bank rules): the interest rate for the original tenure and the interest rate for the actual tenure effective on the value date / the date of renewal. The interest rate on the Fixed Deposit, reduced by the premature closure penalty, cannot be negative.
The interest rate in case of premature partial withdrawal of the Fixed Deposit:
1. The interest on the Fixed Deposit for the period that it remained with the Bank before partial withdrawal will be paid at the rate according to the partial withdrawal amount and the period that it remained with the Bank, or at the contracted rate, whichever is lower – for the amount of the partial withdrawal. The interest rate can be reduced by the premature closure penalty.
2. The interest on the remaining amount of the Fixed Deposit will be paid at the rate according to the remaining amount and the original tenor on the value date / the date of renewal, or at the contracted rate, whichever is lower – for the remaining amount.
The interest rate in case of premature closure of the Fixed Deposit will be calculated based on the interest rate applicable for the period for which the Fixed Deposit remained with the Bank, at the lower of two rates: the interest rate for the original tenure and the interest rate for the actual tenure effective on the value date / the date of renewal. The interest rate can be reduced by the premature closure penalty.
In case of premature partial withdrawal, the interest amount related to the prematurely withdrawn principal amount is paid on the date of premature withdrawal.
No interest shall be paid, where premature withdrawal of Fixed Deposit takes place before completion of the minimum period (7 days).
In the event of death of the Depositor, premature closure of the Fixed Deposit would be allowed without any penal charge, even if the Fixed Deposit is within the lock-in-period.
The Bank reserves the right to disallow premature partial withdrawal or premature closure of collateral Fixed Deposit and /or Fixed Deposit in the amount of INR 10 (Ten) Crores or more.
6. SPECIFICITY OF CREDITING FUNDS TO A FIXED DEPOSIT ACCOUNT FROM A DEPOSITOR`S ACCOUNT OPENED WITH ANOTHER BANK
The funds can be credited to the Fixed Deposit Account from a current account of the Depositor opened with the Bank or from an account opened with another bank (regardless of the having a current account in the Bank).
The Fixed Deposit Account can be opened by the Depositor not having a current account in the Bank through the Bank branch or via Internet Banking. The onboarding of the Depositor should be completed before the Fixed Deposit application can be processed.
For payment transactions exceeding INR 500,000,000 (five hundred million Indian rupees), the Legal Entity Identifier (LEI) is required to be stated in the payment instruction in accordance with the Reserve Bank of India regulations. Where the Fixed Deposit amount (both principal amount and interest amount) may exceed INR 500,000,000, the LEI of the Depositor shall be indicated in the details provided as part of the Fixed Deposit Account request letter. In the absence of the LEI at the time of closure of the Fixed Deposit and transferring of funds to another bank, the payment may be rejected by the payment system due to non‑compliance with mandatory payment information requirements.
Premature partial withdrawal is not available for the Fixed Deposit in case funds were credited from an account opened with another bank.
Premature closure, in case funds were credited from an account opened with another bank, is available through the Bank branch only. The funds will be credited / sent to the source account, i.e. from which the funds were debited / received.
The payment amount from another bank to be credited to the Fixed Deposit Account should be equal to the FD Amount (INR) specified in Fixed Deposit Account request letter (crediting funds from the client's account opened with another bank). The date of receipt of the payment amount for crediting funds shall be no later than 5 calendar days from the application date of the Fixed Deposit Account request letter. Otherwise, the payment will be rejected. If the funds are not credited by 23:00 IST on the fifth calendar day after the application date of the Fixed Deposit Account request letter, the Fixed Deposit Account will be closed.
If the funds are received no later than 23:00 IST, the funds will be credited to the Fixed Deposit Account during the current day, otherwise – the next day.
The interest rate will be applied depending on the tenor and amount of the Fixed Deposit, effective on the day of crediting funds (Value Date) to the Fixed Deposit Account.
7. FINAL PROVISIONS
These Terms and Conditions relating to the Term Deposit (Fixed Deposit) may be amended from time to time, as they are governed by the regulations of the Bank and the RBI.