Top Mutual Funds
Floating Rate Savings Bond 2020 (Taxable)
• Half-yearly interest payout
• Government regulated
• No maximum investment limit
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*Interest Rate is linked to National Savings Certificate (NSC) rate + 0.35% p.a. and is subject to revision in Jan & Jul every year
Fixed income bonds for Individual Investors
Issued by RBI on behalf of Govt. of India
Offers guaranteed, risk-free returns
Interest is linked to
NSC (+) 35bps
Rate is subject to reset
half-yearly
Are non-tradable &
non-transferable
Current rate: 8.05% p.a.
0.35% over National Savings Certificate
Up/down revision possible
Half-yearly interest payments in Jan & Jul every year
Min:₹1,000/- & Max No Limit
7 year Lock-in
✓ Resident Individual
✓ Hindu Undivided Family
FRSBs are issued in a Bond Ledger Account and are not transferable, except for transfer to a nominee(s)/legal heir in case of death of the holder of the bonds.
These bonds are not tradable in the secondary market and are not eligible as collateral for loans from Banks, Financial Institutions & NBFCs
A sole holder or surviving holder of a Bond, being an individual, can make a nomination.
| Age Bracket | Premature closure / withdrawal |
|---|---|
| Below 60 Years | Not allowed |
| 60 to 70 Years | 6 Years |
| 70 to 80 Years | 5 Years |
| >80 Years | 4 Years |
The Bonds are issued for a minimum amount of Rs. 1000/- (face value) and in multiples thereof. There is no maximum limit for investment in Bonds.
The tenure of the bond is 7 years from the date of issue. No interest will accrue after the maturity of the bond. Premature redemption facility is allowed for investors in the age group of 60 years and above as per RBI’s Notification.
Interest is payable semi-annually from the date of issue of bonds, up to 30th June / 31st December as the case may be, and thereafter half-yearly for period ending 30th June and 31st December on 1st July and 1st January respectively.
The interest rate of the bond, would be re-set half yearly starting with Jan 1st, 2021 and thereafter every July 1st and will be liked with the prevailing National Saving Certificate (NSC) rate with a spread of (+) 35 bps over the respective NSC rate. All future coupon would reset based on the fixation of rate of interest of NSC on Jan 01 and July 01.
The interest income from the bonds is taxable. TDS (Tax Deducted at Source) is deducted at the time of interest payment as per the prevailing IT rules.
Yes, a nomination facility is available.
No, these bonds are not transferable.
The Bonds are not eligible as collateral for availing loans from Banks, Financial Institutions & Non-Banking Companies.
