Flexible Rate Deposit Scheme provides a deposit product with a Market determined interest rate linked to a Govt. Security Paper of 10 years maturity.

The scheme provides the depositor an option to invest in various maturities at variable rate of interest option so that he can have a portfolio with an opportunity to match the return with the interest rates on deposits prevalent in the market from time to time.

PURPOSE/OBJECTIVE: Flexible Rate Deposit Scheme provides a deposit product with a Market determined interest rate linked to six months’ average Yield to Maturity on 10 years Govt. Security Papers.
The objective of the scheme is to hedge against the interest rate volatility by offering deposits at a flexible rates. Flexible Rate Schemes will be beneficial to both the Bank and Customer as the rates will be linked to the Market/Base Rate

Launched at 50 select having connectivity under CBS

WHO CAN DEPOSIT (ELIGIBILITY)

The following segment of customers can subscribe to the scheme

a. An individual singly or jointly with more than one individual in the form of 'former or survivor' or 'either or any of the survivor' or by a natural/legal guardian on behalf of a minor child.
b. Firms, Associations and Trusts
c. Hindu Undivided Family (HUF)
d. Companies
e. All institutions

(blind and illiterate customers would not be eligible for opening account under the Scheme)

All the formalities in regard to opening of accounts, including introduction, as applicable in case of deposit accounts including photograph of depositor will be applicable to the scheme, at the time of opening of account. The existing instructions of the Bank for obtention of Nomination, renewal of Term Deposits after due date etc. would be applicable in this Scheme as well.

The account under the scheme will be opened with a minimum deposit of Rs.1,00,000/- (Rupees one lakh), thereafter, in multiple of Rs.10,000/-.

PERIOD : The period of the deposit will be 3 years to 10 years (in completed quarters) as per option of depositor.

RATE OF INTEREST

The Term Deposit under the Flexible Rate Deposit Scheme shall carry interest at the rates calculated on the basis of average yield to maturity (half-yearly) of 10 years on Govt. Security Paper to be re-set every six months, (hereinafter called the ‘BENCHMARK RATE’.) with indicated linkage:

Ø The ‘Benchmark Rate’ as arrived at by Bank shall be final.

Ø The Bank, in its discretion, shall have the right to change the basis and periodicity of effecting change in the Benchmark Rate. Ordinarily, Benchmark Rate with indicated linkages will be fixed by the bank at the beginning of each half-year.

Ø ‘Flexible Rate’ means the net of the Benchmark rate plus/minus indicated linkage, as might be fixed by the bank from time to time.

Ø ‘LINKAGE’ means addition/deduction in Benchmark Rate arrived at as above. The indicated linkage may be either plus or minus to the Benchmark Rate as decided by the Bank for the respective half-year.

With effect from 01.10.2005, the following rates of interest shall be operative under this scheme:

Except for the rates fixed by Treasury Division from time to time no other differential component in the rate of interest will be applicable to the deposits under the above scheme. The differential rates based on the amount slabs payable on a single deposit of Rs.15 lac and above will not be permissible on deposits under this scheme.

STAFF: Discretion to pay additional interest not exceeding one percent on deposits of bank's staff and their exclusive associations

In respect of a Term Deposit account opened under the Scheme in the name of:

a. A member or a retired member of the bank's staff, either singly or jointly with any member or members of his/her family or
b. the spouse of a deceased member or a deceased retired member of the Bank's staff; and
c. an Association or a fund, members of which are the members of the bank's staff,
The bank may, at its discretion, allow additional interest at a rate not exceeding 1% per annum over and above the rate of interest as decided by the Bank provided that the bank shall obtain a declaration from the depositor concerned, that the monies deposited or which may, from time to time, be deposited into such account, shall be monies belonging to the depositor as stated in clauses (a) to (c) above,

PREMATURE PAYMENT

No part amount will be allowed to be withdrawn under this Scheme.

In case of depositors seeking premature withdrawal before 36 months (i.e. the minimum period of deposit undertaken) the Deposit will earn interest rate as applicable to other term deposit schemes and period run rate of interest would be paid.

In cases where premature withdrawal request is received after deposit has run for minimum 36 months, the interest on Deposits will be paid for the applicable slab rate i.e. 36 months to 60 months; 60 months to 84 months or 84 months to 120 months, with half-yearly resets. In such cases, however, deposits will earn interest at Benchmark Rate or Flexible Rate whichever is lower for the tenor of deposit.
CONVERSION

The customers would not be allowed to convert their deposits under Flexible Rate Deposit Scheme to any other deposit scheme. However, the customer shall be free to opt for closure of the account before maturity.

REPAYMENT/RENEWAL

i. The original deposit certificate(s) duly discharged will be required to be presented at the issuing branch. The payment will be made by credit to the account or by way of Banker's Cheque.

ii. The depositor may renew the deposit under the scheme on maturity. The duly discharged original deposit receipt should be presented at the issuing branch for renewal. The deposit will stop earning interest from the date of maturity.
TAX DEDUCTION AT SOURCE

The interest earned under the Flexible Rate Deposit Scheme will be subject to the provision of taxation laws including Income Tax Rules related to Tax Deduction at Source.

LOANS AND ADVANCES

The depositor may request for loans/overdraft against the security of their deposits in accordance with the applicable guidelines as in the case of Bank's other Fixed Deposit Receipts.

List of 50 CBS branches