Hello Friends, Welcome to my Blog Investinfy.com the best financial blogs where you will be able to read about the end to end information on many investment schemes and financial topics. In this Blog post we will be focusing on STDR.
Generally when we want to invest money on any investment scheme , we always asks our friends and relatives that where we can invest ? and they suggests the investment schemes which they like most. Then we invest as per their suggestions, that is good as we consider them as our well wisher , But here I want to mention one thing, if we know end to end information of each investment schemes at least it will help us to understand if that investment scheme is good for us or not.
Hence it is better to have a complete idea about each investment scheme where we invest. Therefor this blog will help you to know end to end information of many Indian investment schemes available right Infront of you.
In this blog post I will be explaining my analysis on STDR Investment scheme. This will be a complete guide on STDR investment scheme. Please read till end of the blog post to know the complete information about this STDR investment scheme. Lets get started.
Table of Contents
- What Is STDR Investment Scheme?
- How does STDR Investment scheme work?
- Features of STDR Investment scheme
- Who can open the STDR account ?
- How do you open the STDR account ?
- STDR Deposit limits
- STDR terms
- STDR Interest Rate
- STDR Compounding Frequency
- STDR Interest Credit Method
- STDR Auto-Renewal Facility
- Income Tax Benefits
- Pre-Mature Closure of STDR
- Loan Facility from STDR account
- Account Conversions
- Nomination Facility
- STDR Earning Projection Table
- FAQ about STDR Investment Scheme
What Is STDR Investment Scheme?
STDR Stands for Special Term Deposit receipt. STDR is a type of Fixed deposit where the interest will be compounded on a quarterly basis.
This scheme is also know as interest reinvestment or cumulative option. This scheme is suitable for the people who wants to receive a compounded amount at the ned of the tenure. that means if you have a lump sum amount with you and you wants to invest that amount in a safe and guaranteed scheme for long term then this investment scheme will be the best investment scheme for you.
Please read till end to know the complete information about STDR investment scheme.
How does STDR Investment scheme work?
Let us understand how does this STDR (Special Term Deposit Receipt) work easy step by step.
- Step1 : You Need to deposit a lump sum amount for specific period.
- Step2 : At the end of the tenure you will get the maturity amount that is deposit amount + interest earned.
Features of STDR Investment scheme
- Safe Investment Option.
- Guaranteed returns.
- Quarterly compounded interest.
- Senior citizens get extra interest rate compared to other customers.
Who can open the STDR account ?
- Any resident individuals can open the individual account.
- Joint account can be created by 2 or more individuals.
How do you open the STDR account ?
- First you need to go your preferable bank and fill the required form requesting to open your STDR account.
- Account can be opened by cash or cheque.
- Date of realisation of cheque will be the date of account opening. That means if you are submitting the cheque to open the Special Term Deposit receipt account once the cheque is cleared and money is deposited to your bank account from that day the account opening date is counted and you will start earning the interest from the day.
- If you have your saving accounts then you can create Special Term Deposit receipt from the saving account funds.
STDR Deposit limits
- Minimum Deposit amount is Rs. 1000
- No Maximum limit of deposit amount that means there is no maximum limit defined, hence you can deposit any amount above 1000 rupees and earn your monthly or quarterly income best on that.
STDR terms
- Minimum Term – 6 Months
- Maximum Term – 10 Years
- Few banks offers more than 10 years terms .
STDR Interest Rate
Interest rate on the day of your Special Term Deposit receipt account opening will remain same throughout the tenure of STDR. It will not change even if there are changes to the interest rate thereafter.
The interest rate % varies from one bank to another bank. Please find the below current interest rates of few bank’s STDR FD .
| Bank Name | Interest Rate for general citizen per year | Interest rate for Senior Citizen per year |
| State Bank Of India | 2.90% to 5.50% | 3.40% to 6.20% |
| HDFC Bank | 2.50% to 5.60% | 3.00% to 6.35% |
| Axis Bank | 2.50% to 5.75% | 2.50% to 6.50% |
| Canara Bank | 2.90% to 5.50% | 2.90% to 6.00% |
| Punjab National Bank | 2.90% to 5.25% | 3.50% to 5.75% |
The interest % varies depending upon the period of deposit. Please find the below table of SBI STDR FD interest rate as per the period of deposit. Longer the period. For more information about the FD interest rate read here
| Period | Interest rate for general public | Interest rate for Senior citizen |
| 180 days to 210 days | 4.40% | 4.90% |
| 211 days to less than 1 year | 4.40% | 4.90% |
| 1 year to less than 2 years | 5.00% | 5.50% |
| 2 years to less than 3 years | 5.10% | 5.60% |
| 3 years to less than 5 years | 5.30% | 5.80% |
| 5 years and up to 10 years | 5.40% | 6.20% |
STDR Compounding Frequency
Quarterly compounding frequency is followed in the investment scheme.
STDR Interest Credit Method
You will receive interest amount upon maturity of the scheme along with the deposit amount.
STDR Auto-Renewal Facility
- If you do not provide any specific instructions to your bank while opening the Special Term Deposit receipt account or before maturity. The Special Term Deposit receipt account is automatically renewed upon maturity.
- It will be renewed for the same period for which it was opened initially.
- The interest rate for the renewed period will be the interest rate on the day of maturity.
Income Tax Benefits
Effective 01-April-2020, the income tax benefits will depend upon whether you choose old tax system or new tax system.
Old Tax System
- Deposit amount (upto Rs. 1.5 lakhs) under 5 years tax saving FD will qualify for tax deduction under section 80C of income tax Act.
- No Tax Deduction benefits for deposit other than 5 years tax saving FD.
- There is a TDS (Tax deducted at source) from bank if the interest received more than Rs. 40000 in a financial year. This is for ordinary citizens. The new TDS limit of Rs. 40000 is from 01-April-2019 onwards. Earlier the limit was Rs. 10000 .
- Bank will provide TDS certificate for the tax deducted.
- Interest received is taxable. you need to declare the interest income under ” income from other sources” during your tax returns filing and pay the income tax as per your income tax slab.
New Tax System
- No income tax benefits. The deposit amount won’t get any deduction benefits under section 80C of any income tax Act.
- There is a TDS (Tax deducted at source) from bank if the interest received more than Rs. 40000 in a financial year. This is for ordinary citizens. The new TDS limit of Rs. 40000 is from 01-April-2019 onwards. Earlier the limit was Rs. 10000.
- For Senior Citizens, TDS limit is Rs. 50000 from 1st-April-2018 onwards. Earlier the limit was Rs.10000.
- Bank will provide TDS certificate for the tax deducted.
- Interest received is taxable. you need to declare the interest income under “ income from other sources” during your tax returns filing and pay the income tax as per your income tax slab.
- Depending upon the term of Special Term Deposit receipt, you can choose to pay tax on interest either on maturity or every financial year.
Pre-Mature Closure of STDR
- Premature Closure of special term deposit receipt is possible . But there will be a penalty for the pre-mature closure.
- The penalty amount is generally 1% of the interest earned.
- Interest will be payable for the duration for which the Special Term Deposit receipt was kept minus the penalty amount.
- The penalty amount may change from time to time.
Loan Facility from STDR account
Loan facility is available upto 90% of the deposit amount plus accrued interest.
Account Conversions
Yes account conversions is possible from Special Term Deposit receipt (cumulative interest pay-out) account to TDR (regular interest pay-out) account and vice versa.
Nomination Facility
Nomination facility is available for STDR Investment scheme. You can either nominate at the time of account opening or after opening the account (but before maturity).
STDR Earning Projection Table
let us take an example and see how much we can earn by investing 10 lakhs rupees with STDR investment scheme with current interest of above SBI interest table.
| Period in years | Deposited Amount in INR | General public Maturity Amount in INR | Senior citizen Maturity Amount in INR |
| 4 years | 1000000 | 1234428 | 1259020 |
| 5 years | 1000000 | 1307600 | 1360186 |
| 6 years | 1000000 | 1379653 | 1446499 |
| 7 years | 1000000 | 1455677 | 1538289 |
| 8 years | 1000000 | 1535889 | 1635903 |
| 10 years | 1000000 | 1709818 | 1850108 |
FAQ about STDR Investment Scheme
Is it possible to transfer my STDR account from one branch to another branch?
Yes STDR accounts can be transferred from one branch to another branch without any extra cost.
I am a NRI can I open STDR account ?
NRI (Non resident Indians ) can not open residential fixed deposits. But they can open NRI fixed deposits accounts and it is a different scheme completely.
What will be the penalty if I close the STDR account before maturity period?
The penalty amount is generally 1% of the interest earned.
What is the difference between TDR and STDR?
The main difference between TDR and STDR is .
TDR is a type of fixed deposit where we can opt to receive monthly or quarterly interest.
STDR is a type of Fixed deposit where the interest will be compounded on a quarterly basis and the interest pay-out happens after the maturity period.