| Overview: Fixed deposits automatically renew at lower rates when unclaimed after maturity. This guide explains the automatic renewal process, interest rate changes, and simple steps for timely deposit withdrawal to maximise your returns. |
When Your FD Reaches Maturity Without Action
Many Indian savers invest in fixed deposits but remain unclear about what happens to FD after maturity if they don’t initiate deposit withdrawal. According to RBI data, fixed deposits remain the preferred savings instrument for risk-averse investors, yet a significant number of FD holders miss their maturity dates. Understanding the post-maturity process helps you make informed decisions about your hard-earned savings and avoid potential losses in returns.
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What Happens to FD After Maturity Automatically
Read on to know more about what happens to FD after maturity.
Auto-Renewal Process Explained
When you don’t withdraw money from a fixed deposit after maturity, most banks automatically renew your FD for the same tenure. However, the new FD gets the prevailing interest rate on your FD maturity date, which is often lower than your original rate.
For example, if your 1-year FD at 7.5% matures today, but current rates are 6.8%, your renewed FD will earn only 6.8% for the next year. This difference can significantly impact your returns over time.
Interest Rate Changes Post-Maturity
Banks typically offer three scenarios for FD renewal rules:
- Automatic renewal at current rates for the same tenure
- Savings account transfer where funds move to your linked savings account
- Manual renewal requiring your maturity instructions
The return of deposit on the maturity date depends entirely on the instructions you provided when opening the FD.
How to Withdraw Money from Fixed Deposit After Maturity
Fixed deposit post-maturity can be withdrawn through both online and offline means.
Online Deposit Withdrawal Process
Most banks now offer digital solutions for fixed deposit withdrawal after maturity:
- Log into your bank’s mobile app or internet banking
- Navigate to the FD section and select your matured deposit
- Choose ‘Withdraw’ or ‘Close FD’ option
- Confirm the withdrawal amount and destination account
- Submit the application for fixed deposit withdrawal after maturity
The process for how to withdraw money from a fixed deposit after maturity online typically takes 1-2 working days for fund transfer.
Offline Withdrawal Options
Traditional branch visits remain necessary for some banks, especially for large amounts. You’ll need your original FD receipt and proof of identity. Senior citizens often prefer this method, as it provides personal assistance and immediate cash availability.
| Fact to Know: Unclaimed FDs worth over ₹35,000 crores remain with Indian banks, earning lower post-maturity rates instead of optimal returns for depositors. |
Managing Multiple FDs and Maturity Instructions
The FD return rules that need to be kept in mind revolve around the setting up of proper maturity instructions and tracking of the FD portfolio.
Setting Up Proper Maturity Instructions
When opening an FD, always specify clear maturity instructions:
- Auto-renewal for continued investment at prevailing rates
- Principal and interest transfer to your savings account
- Partial withdrawal with remaining amount reinvestment
Many investors ask, “Can I withdraw FD on the maturity date?” The answer is yes; most banks allow same-day processing for maturity withdrawals.
Tracking Your FD Portfolio
Create a simple tracking system:
- Set phone reminders 15 days before each FD maturity date
- Use your bank’s mobile app notifications
- Maintain a spreadsheet with maturity dates and amounts
Airtel Finance offers competitive interest rates with flexible maturity options, making FD management simpler through digital-first processes.
Maximising Returns with Timely Action
Missing your FD maturity date doesn’t just affect current returns—it impacts your entire financial planning. By understanding the deposit withdrawal processes and setting proper maturity instructions, you ensure optimal returns on your savings.
Consider using digital FD platforms like the one from Airtel Finance that send timely alerts and offer seamless renewal or withdrawal options. This approach helps you stay in control of your investments and make informed decisions based on current market rates and your financial goals.
Get high ROI with 8.4% on Fixed Deposits. Invest today
FAQs
1. What happens if I don’t claim my FD on the maturity date?
Your bank typically auto-renews the FD at current interest rates, which may be lower than your original rate.
2. Can I withdraw my FD amount online after maturity?
Yes, most banks offer online deposit withdrawal facilities through mobile apps or internet banking platforms.
3. Will I lose money if I forget my FD maturity date?
You won’t lose principal, but you may earn lower interest if current rates are below your original FD rate.
4. How long do I have to withdraw money after FD maturity?
There’s no strict deadline, but delayed withdrawal means earning current rates instead of potentially better investment options.
5. Do banks charge penalties for late FD withdrawal after maturity?
Generally no penalties apply, but you may miss opportunities for better returns or more suitable investment products.
