Federal Bank FD Premature Withdrawal Penalty Calculator

What is the Federal Bank FD Premature Withdrawal Calculator?

Federal Bank FD Premature Withdrawal Calculator is a tool that helps you calculate the accurate sum that you will receive when you close your fixed deposit before its maturity date. Federal Bank FD Premature Withdrawal provides liquidity during financial emergencies, but it can impact your expected returns. The payout is recalculated based on the duration the FD was held and adjusted with up to 1% penalty the bank charges for early withdrawal.

Benefits of Federal Bank FD Premature Withdrawal Penalty Calculator

The Federal Bank FD Premature Withdrawal Penalty Calculator offers precise penalty payout estimates. The notable benefits include:

• Instant Calculation: Get a quick estimate of your updated payout without going to a branch.
• Smarter Decision-Making: Allows you to compare the impact of premature FD withdrawal with other liquidity options, such as a loan or availing an overdraft against the FD.
• Clear Interest and Penalty Breakdown: Displays the amount of interest you lose and the penalty, providing total transparency.
• User-Friendly Interface: This simple input-based tool lets you view your expected returns by entering your tenure, withdrawal date, and deposit details. 

How Does the Federal Bank FD Premature Withdrawal Penalty Calculator Work?

Let us understand this with examples for both general and senior citizens:

1. For General Citizens

   Let’s say a general citizen invested in a Federal Bank Fixed Deposit.

   • Investment Amount: ₹1,00,000
   • Original Tenure: 2 years at a booked rate of 6.80%
   • Premature Withdrawal: After 1 year and 3 months (approx. 443 days)

   On the booking date, Federal Bank FD rates were 6.60% for deposits between 1 year and less than 1 year 6 months.

   Interest Calculation:

   • Applicable Rate for Period Held: 6.60%
   • Penalty Deduction: 1.00%
   • Final Interest Rate: 6.60% – 1.00% = 5.60%

   Outcome: The general citizen will earn interest at 5.60% for 1 year and 3 months, instead of the originally booked 6.80% for 2 years.

2. For Senior Citizens

   Now, let’s consider a senior citizen investing in the same FD.

   • Investment Amount: ₹1,00,000
   • Original Tenure: 2 years at a booked rate of 7.30%
   • Premature Withdrawal: After 1 year and 3 months (approx. 455 days)

   On the booking date, Federal Bank senior citizen FD rates were 7.10% for deposits between 1 year and less than 1 year 6 months.

   Interest Calculation:

   • Applicable Rate for Period Held: 7.10%
   • Penalty Deduction: 1.00%
   • Final Interest Rate: 7.10% – 1.00% = 6.10%

   Outcome: The senior citizen will earn interest at 6.10% for the actual holding period of 1 year and 3 months, instead of the booked 7.30% for 2 years.

   Note: Senior citizens receive 0.50% higher FD interest rates than general citizens on most tenures.

Federal Bank FD Premature Withdrawal Penalty Charges

The Federal Bank permits premature withdrawal of fixed deposits in case of emergencies. For rupee term deposits below ₹2 crores, no penalty is levied if the FD is withdrawn within 15 days from the date of deposit. However, if the deposit is held for more than 15 days, a penalty of 1% is applied to the applicable interest rate corresponding to the actual tenure for which the deposit was maintained.

Key Takeaways

When closing a fixed deposit early, the Federal Bank FD Premature Withdrawal Penalty Calculator is useful for estimating your ultimate payout. If the deposit is withdrawn after 15 days, a 1% penalty is applied on the applicable interest rate for the actual holding term rather than the higher booked rate.