Indian Bank Short Term FD

Understanding Indian Bank Short Term FD

Indian Bank short-term FD is a fixed deposit scheme in which you can place a lump sum between 7 days and up to 1 year. It comes with assured returns without market fluctuations. The Indian Bank FD interest rates are determined at the time of opening, which enables good financial planning and predictable income. This FD has a low minimum deposit that makes it suitable for first-time investors, salaried employees, and temporary surplus holders. The interest rates for senior citizens are higher, and it is a safe short-term investment.

Indian Bank Short Term FD Interest Rates

Interest rates on Indian Bank Short Term FD vary by tenure and customer category. Senior citizens enjoy additional interest benefits. Below are the indicative interest rates offered by Indian Bank for short term domestic deposits:

Indian Bank interest rates effective from 1 November 2025.

Benefits of Indian Bank Short Term FD

Here are some key advantages of choosing a Short term FD in the Indian Bank:

• No Upper Limit for Retail Deposits: Indian Bank does not prescribe a maximum cap for retail fixed deposit investments. However, deposits of ₹2 crore and above are classified as bulk deposits and may carry different interest rates as per the bank’s applicable policies.
• Nomination Facility: Depositors are also able to nominate nominees to facilitate a smooth transfer of maturity proceeds to the beneficiaries.
• Easy Liquidity: The Indian Bank FD premature withdrawal can be done, but with penalties, and the interest is recalculated; it still provides liquidity in case of emergency without closing the deposit.
• Senior Citizen Benefits: Senior citizens get the benefit of higher interest rates, and so the Indian Bank Short Term FD can be an attractive option for generating secure and short-term revenue.
• Sweep-in Facility: Indian Bank sweep-in FD automatically sweeps in excess money from your savings account to the linked short term FD, which allows you to earn better interest, without losing liquidity to day-to-day transactions.

How to Open an Indian Bank Short Term FD?

Indian Bank allows customers to open Short term FDs both digitally and offline, ensuring flexibility and accessibility.

Online Process

To open an Indian Bank Short-Term FD, follow these simple steps:

• Log In: Log in to the Indian Bank Internet Banking or Mobile Banking application.
• Navigate: Click on the Term Deposit / Fixed Deposit.
• Select FD: Select the option of opening a New Fixed Deposit.
• Enter Details: Give the deposit amount, tenure, and the mode of preferred interest payout.
• Nominee Info: Included nominee information where necessary.
• Confirm & Authorise: Confirm and certify the transaction to complete the FD creation.

Offline Process

Alternatively, to open an Indian Bank Short-Term FD offline, follow these steps:

• Visit Branch: Visit your nearest Indian Bank branch.
• Fill Form: Complete the Fixed Deposit opening form.
• Submit KYC: Provide revised KYC documents when required.
• Choose Term & Interest: Select the mode of interest payout and tenure.
• Make Deposit: Make payment through cheque, cash or bank transfer.
• Receive Receipt: Issue a physical receipt of the FD.

Who Should Consider Indian Bank Short Term FD?

In the case of the Indian Bank Short Term FD, it is suitable for a broad group of investors:

• Depositors Holding Short-Term Funds: Depositors who have excess funds that are not required for the next one year to twelve months can earn higher returns by investing in short term FDs rather than keeping money in their savings account.
• Conservative Investors: Customers who want guaranteed and risk-free returns can depend on the fixed interest payments of the Indian Bank.
• Senior Citizens: Senior citizens receive stable short-term incomes, as higher applicable interest rates apply.
• Working Professionals: Salaried depositors can save for upcoming expenses, e.g. premiums or EMIs, or individual obligations with the help of short-term FDs.
• Small and Medium Businesses: Businesses can save their short-term surplus cash in these FDs to earn extra income and also maintain liquidity.
• First-Time Investors and Students: Indian Bank short-term FDs are suitable for students and first-time investors as they have shorter terms, a minimum deposit requirement, and are safe.

Tax Considerations on Indian Bank Short Term FD

The interest earned on the Indian Bank Short Term FDs is subject to taxation according to the applicable laws of income tax in India. TDS (Tax Deducted at Source) applies when the total interest on the deposits of Indian Banks exceeds ₹50,000 in a financial year for non-senior citizens, though the exemption limit among senior citizens is higher, i.e., ₹1,00,000. When a PAN is provided, the TDS rate is 10% and when not provided, the TDS rate is 20%. Investors with an annual income lower than the taxable limit may file either Form 15G or Form 15H to avoid the deduction of tax at the source.

Key Takeaways

Indian Bank Short Term FD provides a great opportunity to those who want to invest their funds into secure and guaranteed returns for a span of 7 days to 1 year. The FD offers flexibility, liquidity, and consistent returns with competitive interest rates applicable to both the general population and senior citizens. It enables easy access to money by premature withdrawal and provision of a sweep-out facility to excess funds, and has no maximum limit to the amount of deposit, hence making it applicable to both depositors and businesses.