What happens if you don't renew or withdraw your fixed deposits?
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What Happens If You Don't Renew or Withdraw Your Fixed Deposits?

  • Highlights

  • Banks can auto-renew an unclaimed fixed deposit

  • There is no limit for the number of auto-renewals

  • Company FD agents contact you before maturity

Fixed deposits are a great way of investing your savings and multiplying your wealth. Since they are secure and risk-free, they’re the ideal choice when you don’t want to take market risks. While fixed deposit require very less monitoring as they promise fixed returns, you do need to be watchful of the maturity date. Here is all you need to know about unclaimed fixed deposits.

Unclaimed bank fixed deposit

The procedure followed by a bank when a fixed deposit is unclaimed may vary according to the rules and regulations set down by the bank. Most banks tend to follow a similar rule when fixed deposits are unclaimed after the maturity date—they are allowed to pay the existing savings account rate or renew the unclaimed fixed deposit unlimited times. This decision solely depends on the bank you have invested in. If a fixed deposit is unclaimed

after two or three consecutive tenors, the bank may try to contact you for further instructions on how to go ahead with the investment. If the bank is unable to track down the investor or nominee, it will continue to renew the investment at the current rate of interest.

Additional Read: A simple guide to using a Fixed Deposit Calculator

Unclaimed company fixed deposit

If you have invested in a reliable company’s fixed deposit such as the Bajaj Finance Fixed Deposit, the company will ensure that it reminds you of the maturity date three months prior. A sourcing agent from the company will remind you of the maturity date and also inquire about your decision of how you want to proceed. In most cases, you will need to visit a branch to renew the fixed deposit which must be done seven days prior to the maturity date. You have the freedom to choose between investing only the principal amount or the total amount of the principal with the interest gain. This process makes unclaimed fixed deposits a rare possibility. Even so, if a fixed deposit is unclaimed, the maturity amount is transferred into the bank account provided by the investor in the initial investment form. This is done using National Electronic Fund Transfer (NEFT) or Real Time Gross Settlement (RTGS). In a case where the electronic transfer amount bounces, the amount is sent to the investor in the form of a cheque.

Investment options to secure your child’s future

The safer option

Both banks and companies try to avoid a situation wherein there is an unclaimed fixed deposit. However, the safer option with regard to such a situation would be choosing to invest in a reliable company’s fixed deposit. The chances of an unclaimed company fixed deposit are less as compared to a bank fixed deposit. This is due to the company protocol of contacting customers well before the maturity date. Renewing FDs is profitable, and has several advantages. Check out some of the advantages below.
Benefits of Renewing Fixed Deposit

Thus, if you have multiple investments and find it difficult to keep track of them, a company fixed deposit is the better option for you. In addition to being reminded of the maturity date of your investment, you will also benefit from higher returns and more flexibility.

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