What are the Documents Required for Fixed Deposits?

Are you planning to open a fixed deposit? FDs or fixed deposits are among the safest investment options with fixed returns. Investors can have a diversified portfolio by investing in FDs to earn fixed returns at defined interest rates. These returns are independent of market volatility.

Here’s what you need to know about fixed deposits and the primary documents required for fixed deposits.

An Overview of Fixed Deposits

Before learning about the documents required for opening a fixed deposit account, it is essential to have a quick background of FDs. It is easy for investors to open a fixed deposit in any bank or NBFC. The two main types of fixed deposits are bank deposits and company deposits. The key differences between the two are:

• Bank deposits have low-interest rates when compared to company deposits
• Company deposits should be made with high-performing and reliable companies only. The banks, on the other hand, may offer deposit insurance

Features Of Fixed Deposits

Below are some of the salient features of FDs:

• Returns forecasting

Investors can quickly calculate the returns using the online interest calculator banks, or companies offer. These require details like principal amount, interest rate, and FD tenure. Hence, it becomes easy to plan your financial growth.

• Loan option

Investors can avail of loans against fixed deposits. These are highly secured loans, as fixed deposits act as collateral.

• Flexible tenure

It is easy for investors to select from the available fixed deposit tenures according to their requirements.

• Tax benefits

Investors can claim a tax benefit of up to Rs 1,50,000 if investing in a tax-saving fixed deposit account under Section 80 C of the Income Tax Act.

• Stable returns

The FD returns are stable and irrespective of the market volatility. The cumulative FDs offer interest on the deposit after the completion of the maturity. The non-cumulative FDs, on the other hand, allow interest pay-outs on a monthly, quarterly, half-yearly, and annual basis.

Requirements For A Fixed Deposit Account

Who can open a fixed deposit?

The following persons can open a fixed deposit account in India:

• Indian citizen
• Non-residential Indian (NRI)
• Government department
• Trust
• Partnership firm
• Public or Private limited companies
• Sole proprietorship
• Club
• Society
• Association
• Hindu Undivided Family (HUF)

Procedure And Formalities For Opening A Fixed Deposit

Let us understand the FD opening process for different investors type:

1. Existing customers

Banks have all the details of the existing customers. However, you may need to submit the Know Your Customer or KYC documents and recent coloured passport-sized photographs.

2. New customers

These individuals must submit recent coloured passport-sized photographs and documents for KYC verification. These include:

• Passport
• Voter ID card
• Driving license
• AADHAAR card
• PAN card

3. Trusts

The documents required for trust to submit to the respective authority before opening an FD are:

• Passport-size photographs
• Board resolution for FD account opening
• Registration certificate
• Copy of trust deed

4. Local authorities or statutory board

The authorities or board must submit the following documents before opening an FD:

• Passport-size photographs
• Copy of permission given by the government authority or ministry
• KYC of authorised signatories
• Registration or incorporation certificates
• Latest electricity bill or latest telephone bill
• PAN card

5. Registered societies

The documents required for fixed deposit by registered societies are:

• Passport-size photographs
• Memorandum and articles of association
• Registration or incorporation certificates
• Latest electricity bill or latest telephone bill
• PAN card
• KYC of authorised signatories
• Board resolution for FD account opening

6. Partnership firms

These can open a fixed deposit using the following documents:

• Passport-size photographs
• Registration certificate
• PAN card
• KYC of authorised signatories
• Partnership deed

7. Hindu Undivided Family

The following documents are necessary for opening an FD by Hindu Undivided Family:

• Passport-size photographs
• HUF declaration and deed
• PAN card
• KYC documents

8. Public or Private limited companies

The documents required for fixed deposit by public or private limited companies are:

• Passport-size photographs
• Registration or incorporation certificates
• Latest electricity bill or latest telephone bill
• PAN card
• KYC of authorised signatories
• Board resolution for FD account opening

Key Takeaways

Opening a fixed deposit is easy for investors. FDs offer several benefits to investors, and one must carefully go through the detailed procedure and formalities for making an informed investment decision.

ICICI Securities Ltd. (I-Sec). Registered office of I-Sec is at ICICI Securities Ltd. - ICICI Venture House, Appasaheb Marathe Marg, Prabhadevi, Mumbai - 400 025, India, Tel No : 022 - 6807 7100. I-Sec is a Member of National Stock Exchange of India Ltd (Member Code :07730), BSE Ltd (Member Code :103) and Member of Multi Commodity Exchange of India Ltd. (Member Code: 56250) and having SEBI registration no. INZ000183631. Name of the Compliance officer (broking): Ms. Mamta Shetty, Contact number: 022-40701022, E-mail address: complianceofficer@icicisecurities.com. Investments in securities markets are subject to market risks, read all the related documents carefully before investing. The contents herein above shall not be considered as an invitation or persuasion to trade or invest. I-Sec and affiliates accept no liabilities for any loss or damage of any kind arising out of any actions taken in reliance thereon. The contents herein above are solely for informational purpose and may not be used or considered as an offer document or solicitation of offer to buy or sell or subscribe for securities or other financial instruments or any other product. Investors should consult their financial advisers whether the product is suitable for them before taking any decision. The contents herein mentioned are solely for informational and educational purpose.