Indian Overseas Bank Fixed Deposit (FD) Rates

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08 min read

Indian Overseas Bank (IOB), one of the oldest banks of India, offers a range of retail banking products and services to customers. One such banking product with a capital guarantee and fixed interest rate is a fixed deposit (FD) account. 

There are several types of FD schemes offered by the bank. Customers can choose the right type of FD scheme that suits their requirements.

IOB Fixed Deposit Interest Rates 2021

The FD interest rates offered on a deposit below Rs.2 crore are given in the table below. The rates provided are effective from 9 November 2020.

Deposit TenureInterest Rate (% p.a.) for Regular Customers**Interest Rate (% p.a.) for Senior Citizens**
7-14 days*3.403.90
15-29 days3.403.90
30-45 days3.403.90
46-60 days3.904.40
61-90 days3.904.40
91-120 days4.404.90
121-179 days4.404.90
180-269 days4.905.40
270 days < 1 year4.905.40
1 year < 2 years(except 444 days)5.155.65
444 days5.205.70
2 years < 3 years5.205.70
3 years and above5.205.70
IOB Tax Saver Deposit5.205.70

*You can choose a deposit tenure of 7-14 days only with a minimum deposit amount of Rs.1 lakh.

**Interest rates are subject to change from time to time.

Different Types of IOB FD Schemes

1. Reinvestment Deposit

A Reinvestment Deposit account allows customers to reinvest the interest earned on the deposit. That means the interest and your deposit will earn interest. This option is available when your deposit account has completed one cycle. The minimum deposit amount is Rs.1,000 and in multiples of Rs.100 thereafter.  Renewals can be done in any amount.

2. IOB Eighty Plus TD

The scheme is designed for super senior citizens of the age of 80 years and above. The tenure of the deposit can range from six months up to 12 months. A loan facility is available of up to 90% for self or jointly with a spouse only.

3. Vardhan

Senior citizens can park their funds in this account. The account can be opened either in the fixed deposit form or in the recurring deposit form. The tenure can range from 15 days to 120 months for the former and from six months to 120 months for the latter. An additional 0.50% is applicable on the card rates. However, non-resident senior citizens will not get to enjoy this additional benefit.

4. Floating Rate Deposits

As the name suggests, a floating interest rate will be applied to the deposit. The deposit tenure for such accounts can range from three years up to 10 years. The five-year G Sec rate will be applied to deposits with a tenure of three to five years, and a 10-year G Sec rate will be applied to deposits with a tenure of five to 10 years.

5. MACAD

A Motor Accident Claims Annuity (Term) Deposit Account is a lump sum amount placed in a term deposit account arising due to a motor accident. The period of deposit can range from 36 months up to 120 months. Loan or overdraft facilities will not be available.

6. Special Fixed Deposit (M-Q)

The deposit scheme targets pensioners and senior citizens and provides monthly or quarterly interest income. The minimum deposit amount is Rs.3,000, and the tenure can range from six months up to 120 months. The monthly interest is payable at discounted rates.

7. Multiple Deposit Plan I & II

There are four different types of accounts available under this scheme. The minimum deposit amount can range from Rs.100 to Rs.10,000 based on the variant you select. The tenure can be from 6 months up to 120 months. The interest will be compounded quarterly and will be paid out at the time of maturity.

8. IOB Saral

This reinvestment deposit scheme comes with a facility to withdraw part of the deposit and continue the balance with the contracted interest rate. A minimum sum of Rs.10,000 can be deposited without an upper limit. The minimum period of account is 12 months, and the maximum can be 10 years. 

9. IOB Suvidha

This term deposit account comes with a cash credit facility and a personalised cheque book. That is, a cash credit account will be opened alongside the term deposit account. Upon maturity of the term deposit account, the proceeds will be credited to the CC account. The minimum deposit for this account is Rs.1 lakh. The tenure can be within 15 months and 10 years.

10. Unfixed Deposit 

The tenure for this account is from 7 days up to 179 days. The minimum deposit is Rs.50 lakh. A prepayment penalty is not applicable. Additional interest rate is not applicable for senior citizens and staff members under this scheme.

IOB FD Special Features and Benefits

  • Customers have the freedom to choose the deposit amount and tenure.
  • Senior citizens can earn an additional 0.5% interest on the regular interest rates applicable to their deposits.
  • Super senior citizens (aged 80 years and above) can earn an additional 0.75% on the regular interest rates applicable to their deposits.
  • Competitive interest rates are offered on FD schemes.
  • A separate tax-saver FD scheme is designed for NROs.
  • Individuals and non-individuals have various FD scheme options.
  • Interest payout and reinvestment options are available.
  • Resident individuals can save income tax by investing in the Tax Saver scheme.
  • Premature withdrawal and partial withdrawal facilities are available on certain schemes.
  • You can take a loan against the deposit account instead of premature withdrawal for emergencies.

Basic Eligibility Criteria for IOB FD

Reinvestment DepositThe customer should have a deposit account that is about to reach the maturity date.
IOB Eighty Plus TDAll super senior citizens aged 80 years and above. 
VardhanIndividuals aged 60 years and above.
MACADIndividuals, including minors through guardians, in the single name (based on court order).
Special Fixed Deposit (M-Q)Senior citizens/pensioners who want regular monthly or quarterly interest income.
Multiple Deposit Plan I & IISalaried people, professionals, business people, etc.

Singly or jointly with two or more persons
Institutions, companies, firms, societies, traders, professionals, salaried individuals, etc.
NRO Tax SaverNon-Residents of Indian Origin
IOB SaralNRIs, Indian resident individuals, and minors
IOB SuvidhaIndividuals (including NRIs/NROs), firms, corporates, PSUs, institutions, HUFs, trusts, and societies. Minor’s special deposits are not allowed under the scheme.
Unfixed DepositIndividuals
Tax Saver SchemeIndividuals and Kartas of Hindu Undivided Families in single or joint names.

Documents Required

IOB Eighty Plus TDValid KYC documents containing age/DOB as per existing KYC policy.

A birth certificate or any other valid proof containing age/date of birth can also be accepted as proof of age.
VardhanOne of the following documents:
Pension payment order
School leaving certificate
Voters identity card
LIC policy where age is admitted
Birth certificate issued by a competent authority
Passport
Driving License

Tax Benefits on IOB Fixed Deposit

Tax Saver Scheme

You can deposit a sum of Rs.10,000 up to Rs.1.5 lakh in this account and get income tax deductions under Section 80C of the Income Tax Act, 1961. The deposit period can be from 5 years up to 10 years. You can choose from options, such as reinvestment deposit, fixed deposit, and special fixed deposit. Senior citizens get an additional 0.5% interest above the regular rates.

NRO Tax Saver

The scheme is designed for Non-Resident of Indian Origin (NRO). A minimum of Rs.10,000 and a maximum of Rs.1.5 lakh can be deposited in this scheme. The account includes a lock-in period of five years and a maximum tenure of 10 years. Customers can get an income tax exemption of up to Rs.1.5 lakh under Section 80C of the Income Tax Act, 1961.

FD Interest Rate Calculator

Get a glimpse of the possible maturity amount and interest you can earn after investing a certain amount in a term deposit account using ClearTax’s FD Calculator.

Frequently Asked Questions

How is the foreclosure of term deposit accounts handled by the bank?

If you wish to close an FD (term deposit) account before its maturity date, the bank will levy foreclosure charges on the deposit account. The charges vary based on the deposit amount. The below table provides details on the foreclosure charges based on the deposit amount.

DescriptionForeclosure Charges
Retail term deposits up to Rs.15,000Nil
Retail term deposits between Rs.15,001 and Rs.5 lakh0.50%
Retail term deposits between Rs.5 lakh and Rs.1 crore1.00%

Can the bank staff get any additional benefits in terms of interest rate on term deposits?

The retired bank staff will get an interest rate governed by the guidelines in force when opening the term deposit account.

In case I take a loan against the deposit, should I pay any interest?

If you happen to take a loan against the deposit, you may have to pay an interest charge of 1% over and above the deposit rate in the case of demand loans. In any cash credit accounts, the interest rate on loans will be 1.50% above the deposit rate. Third-party loans are not available.

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