State Bank of India (SBI) offers an annuity deposit scheme in which the customers can get a fixed amount every month after depositing a lump sum amount. As per SBI official website, a fixed amount is provided to the account holder in equated monthly instalments (EMIs). The EMIs comprises a part of the principal amount as well as interest on the reducing principal amount, compounded at quarterly rests and discounted to the monthly value. So, the deposits made by the customers are returned to them in the form of a monthly installment, along with interest.
Minimum amount for SBI annuity scheme
The minimum deposit amount for the SBI annuity deposit is based on a minimum monthly annuity of ₹1000 for the relevant period. i.e for 3 yrs, the minimum deposit amount will be Rs. 36,000. However, there is no maximum limit. The interest starts on the amount deposited by the customer after a fixed time
How SBI annuity deposit scheme is different from the Recurring deposit account?
In the Recurring deposit account, the customer makes the payments in installments and receives the maturity amount at maturity date while the SBI annuity deposit accepts a one-time deposit and that amount plus interest on reducing principal is repaid to the customer in installments over the tenor selected by him/her.
How SBI annuity deposit is different from the Fixed deposit account?
In the SBI FD account customer makes a one-time deposit and receives the maturity amount at maturity date which comprises principal and interest in case of STDR and principal only in case of TDR as interest is paid at a periodic interval. SBI annuity deposit accepts one-time Deposit and the amount is repaid to the customer over the tenor selected by him/her, along with interest, in equated monthly installments.
Rate of interest
The rate of interest as applicable to the SBI annuity scheme is the same as SBI FD. At present, SBI gives a 2.9% to 5.40 % interest rate on deposits maturing in 7 days to 10 years. These rates are effective from 8 January 2021.
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