What Happens If a Fixed Deposit (FD) Is Broken Before Maturity?
- Posted:20th November, 2024
- Updated:20th November, 2024
Breaking a fixed deposit (FD) before maturity usually leads to the following:
- Penalties: Most financial institutions impose a penalty for withdrawing funds before the FD reaches its maturity. The penalty varies by institution, FD type, and remaining maturity period.
- Reduced Interest Rate: The interest rate paid may be lower than the original rate, adjusted for the shorter term.
- Pre-Closure Charges: Some institutions may apply additional pre-closure or early withdrawal fees.
Review the FD agreement or consult with the institution for specific details on penalties and charges.
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