A fixed deposit (FD) is one of the most secure investment options, offering guaranteed returns over a specified tenure. However, if you need urgent funds, you do not always have to break your FD and lose the interest benefits. Many banks, including State Bank of India (SBI), allow you to avail a Rs. 30000 loan against your fixed deposit without prematurely closing it.

How a loan against fixed deposit works

In this facility, your fixed deposit acts as collateral for the loan. The bank marks a lien on the FD, meaning you cannot withdraw it until the loan is repaid. However, it continues to earn interest at the agreed FD rate. The loan amount sanctioned is typically a percentage of the FD's value—often up to 90–95%—ensuring you have quick access to funds while your investment remains intact.

Benefits of a loan against FD

  • No need to break the FD: Your investment remains active and continues to generate returns.
  • Lower interest rates: Since the loan is secured, the interest rate is usually 1–2% higher than the FD rate, making it cheaper than personal loans or credit cards.
  • Quick disbursal: Processing is fast because the bank already holds your deposit.
  • No credit score impact: Approval is based on the FD, so even those with limited credit history can qualify.

Eligibility and documentation

To get a Rs. 30000 loan against an FD, you must hold an active fixed deposit with the bank. Joint account holders may require the consent of all parties. Required documents are minimal—generally your FD receipt, identity proof, and a signed loan agreement.

Repayment terms

Repayment can be made through EMIs or in a lump sum before the FD maturity date. The loan tenure usually matches the FD's remaining term. Prepayment is often allowed without penalties, giving you flexibility.

Example scenario

If you have an FD of Rs. 50,000 earning 6% interest per annum, you can apply for a loan of up to Rs. 45,000. For a Rs. 30000 loan, the bank will charge an interest rate slightly above 6%, and you will continue to earn interest on the full FD amount until maturity.

Conclusion

A Rs. 30000 loan against a fixed deposit is a practical way to access funds without sacrificing your savings' earning potential. With low interest rates, quick processing, and minimal documentation, it offers a reliable solution for short-term financial needs while preserving your investment.