Bank of Baroda’s new Systematic Deposit Plan: Check details before investment

Bank of Baroda has recently unveiled a Systematic Deposit Plan (SDP) for its investors. The SDP functions as a monthly saving scheme crafted to help clients effectively manage their savings while aiming for increased returns along with flexibility.

The Systematic Deposit Plan (SDP) allows investors to deposit funds in an organized manner, even in smaller amounts. It resembles a recurring deposit in terms of periodic payments, yet its operation is more akin to a fixed deposit. Each contribution to the SDP is treated as a new Fixed Deposit (FD), earning interest at the prevailing term deposit rate. This characteristic renders SDP appealing to individuals seeking to start an FD without a substantial lump sum. Upon maturity, akin to an FD, the SDP repays the principal amount with the accrued interest.

Key features

Bank of Baroda Systematic Deposit Plan offers a unique set of key features designed to cater to the diverse financial needs of customers:

A. Instalments: With this plan, customers are not required to make a one-time deposit. Instead, they have the flexibility to make deposits in instalments, making it more convenient and accessible.

B. Flexible tenures: Customers have the freedom to choose a deposit tenure that suits their financial goals, ranging from six to 120 months (or half a year to 10 years). The tenure options include 6, 9, 12, 15, 18, 21, 24...up to 120 months, providing a wide range of choices.

C. Higher rate of interest: The deposit plan offers a competitive interest rate that varies based on the chosen tenure. Interest is compounded quarterly and paid out upon maturity, allowing customers to maximize their savings along with the principal amount.

D. Overdraft facility: Depositors have the added benefit of availing an overdraft (or loan) facility of up to 95 percent of the deposit amount, giving them financial flexibility and convenience when needed.

Overall, Bank of Baroda Systematic Deposit Plan stands out for its flexibility, competitive interest rates, and additional financial benefits like the overdraft facility, making it a preferred choice for savvy investors.

Who all can invest

Anyone has the option to initiate a systematic deposit plan. This opportunity is open to a wide range of individuals, including minors, farmers, employees, entrepreneurs, self-employed professionals, traders, and homemakers.

Other points

> The Statement of Deposit and Payment (SDP) account can be opened by an individual in his own name. In situations involving more than one individual, the account will be joint.

> Furthermore, the SDP account can also be established for a minor aged 10 and above, subject to the terms set forth by the bank. It is also possible to open the account in the name of the minor with their father or mother acting as the guardian.

> In addition to individuals, SDP accounts can be opened by clubs, associations, educational institutions, partnerships, and joint-stock companies, provided they are registered and the bank is convinced that the account is being opened for legitimate savings purposes. It is important to note that this product is not available for NRE deposits.