SBI Loan against Fixed Deposit: You might be thinking is it really possible to get a loan from SBI against a FD account? Or what is the difference between SBI personal loan and SBI Loan against Fixed Deposit? In this article I will be sharing everything about this loan against SBI FD and why it is the best alternative to SBI personal loan.
Generally personal loans are good to have when one need emergency cash and there is no arrangement for the same. Although it is always advised to save money from your earning to build an emergency cash to handle situation like this.
But as you don’t have enough cash now, you have to go for a personal loan. But if you have a fixed deposit account with State bank and that is having enough money, you can go for a loan against your FD account.
What is SBI Loan against Fixed Deposit / Term Deposit
This is nothing but a way to get a personal loan only, but there are couple of benefits or advantages. Here are the key highlights of SBI Loan against Fixed Deposit.
Here you can get a Loan up to 90% of the value of your Time Deposit. That means 10% is not allowed as per security rules of SBI loan. 90% of his e-STDR / STDR value and 75% of his e-TDR / TDR as Overdraft facility on the Internet banking platform. At Branch level the customer can avail 90% of his underlying security value as Demand Loan/ Overdraft facility
Both Demand Loan and Overdraft Facility as per your need. If you want to get a SBI loan online, then you have to go for overdraft loan only. For demand loan you have to visit to nearest SBI branch and apply there only.
The interest rate is quite low when you compare with personal loans. For SBI the rule is 1% higher than the term deposit interest rate. That means if your bank FD is earning 8% interest on fixed deposit then your loan interest will be 9%. If you have applied for personal loan, then you might have aware that the general interest rates for personal loan is ranging from 14% to 20% depending on the amount & cases.
In case of this SBI loan, you don’t have to pay any processing charges. But in case of personal loan the processing fee is mandatory.
No prepayment penalties. Yes, this is the best feature as in case of personal loan you may have to pay an extra charges as per banks personal loan terms & conditions.
How To Apply SBI Loan against Fixed Deposit Online / Offline
The process is quite simple and available both online and offline as I have mentioned already. Anyway, lets follow the step by step guide below.
- You have to login to your SBi net banking account through www.onlinesbi.com and log in using his/her User Id and Password.
- Look for option like Overdraft against Fixed Deposit under e-Fixed Deposit tab. There you have to fill up the necessary information and execute the transaction.
- Alternatively customer can also approach the Branch for availing the facility when Overdraft loan is not enough for your money need. You can apply for demand loan by visiting your nearest SBI branch only.
Did you apply for SBI Loan against Fixed Deposit ever? How was your experience while applying for SBI loan online? Share your feedback of any useful user experience here by writing a simple comment below. Thanks for reading and sharing this article.