What is Auto-Renewal of Fixed Deposit: Benefits and Key Considerations
Fixed Deposits (FDs) are a much sought-after investment in India. They are not only preferred by individuals seeking secure and predictable returns on their savings, but also by those who want to diversify their portfolio. FDs not only guarantee assured returns, but they also help offset some of the risks other investments may be exposed to.
Apart from guaranteed returns that are compounded by interest, another attractive feature offered by many banks, including ICICI Bank, is the option of auto-renewal of FDs. This blog will explore the concept of auto-renewal of FDs, its benefits, the reasons banks provide this facility and important factors to consider before opting.
Understanding Auto-Renewal of FDs
Auto-renewal is a facility that allows investors to automatically renew their FDs, upon maturity, for the same tenure as the original deposit. Instead of having to visit the bank or provide instructions to renew the FD, investors can enjoy a seamless process where the FD gets reinvested.
Benefits of Auto-Renewal
● Seamless Process: Auto-renewal eliminates the need for investors to physically visit the bank or go through online procedures to renew their FDs. This saves time and effort, making it a convenient option for those looking for a hassle-free experience.
● Continued Earnings: With auto-renewal, investors can ensure their funds remain invested, thus continuing to earn interest without any breaks. This ensures the compounding effect, leading to higher returns.
● Rate Protection: In a falling interest rate scenario, auto-renewal protects investors from reinvesting at lower rates. They can continue to earn interest at the rate applicable at the time of the original deposit.
● Default Prevention: Sometimes, individuals may forget to renew their FDs upon maturity, leading to the funds being held in a non-interest-bearing account. Auto-renewal helps prevent such instances and ensures the funds are continually invested.
Why Banks Provide Auto Renewal Facility
The auto-renewal facility benefits both banks and customers. For banks, it enhances customer experience and engagement. Banks can assist existing customers and foster long-term relationships by offering a convenient renewal process. Additionally, it streamlines the administrative process for the bank, making it efficient and cost-effective.
For customers, the facility enhances convenience and offers peace of mind. It aligns with the bank's objective of providing customer-centric services while encouraging savings and disciplined investing.
Important Considerations before Opting for Auto-Renewal
When it comes down to your hard-earned money, caution and consideration are essential. As with any investment, you should account for a few things before opting for an auto-renewal of your FD.
● Interest Rates: Before opting for auto-renewal, investors should consider prevailing interest rates and the bank's renewal rates. While it ensures continued earnings, there may be better interest rates on offer through other investment options—the added risk notwithstanding.
● Investment Goals: Investors should assess their financial goals and time horizon before opting for auto-renewal. Manual renewal may be more suitable if they have specific plans for the funds upon maturity, such as a major expense or investment opportunity.
● Liquidity Needs: Auto-renewal ties up the funds for the same tenure as the original deposit. Individuals who require liquidity at a specific time should carefully evaluate whether auto-renewal aligns with their needs.
● Renewal Instructions: Investors must ensure their FD has the auto-renewal feature and understand the renewal process. They should keep track of the maturity date and review the renewal terms to avoid surprises.
ICICI Bank FD Renewal Process
Existing ICICI Bank Savings Account customers can open an FD through the iMobile Pay App or Retail Internet Banking. They can also visit the nearest ICICI Bank Branch or call Customer Care for assistance. The bank offers auto-renewal when opening the FD or any time before maturity.
The closure proceeds for FDs with auto closure are credited to the linked savings account on the maturity date.
Please note- an FD with pre-set auto-renewal can be closed through various channels, including internet banking, iMobile Pay App, visiting a branch, or using an ATM for amounts less than Rs 50,000.
Renewing Your FD with Ease on the iMobile Pay App
Are you an ICICI Bank customer looking to renew your FD? With the iMobile Pay App, renewing your FD has never been easier. Follow these simple steps to ensure your funds continue to grow seamlessly:
● Accessing the iMobile Pay App: Log in to the app using your fingerprint for quick and secure access to your account.
● Navigating to Your FD: Click ‘Accounts and Deposits’ to view your existing FDs and other deposit accounts once logged in.
● Selecting FD/ (Recurring Deposits) RD: In the ‘Accounts and Deposits’ section, click on ‘Deposits FD/RD’ to access all your fixed and RD accounts.
● Choosing the FD: Locate the specific FD you want to renew and tap on it to view details like the maturity amount and maturity date.
● Renewal Options: On the same page, you'll find ‘FD Advice and More Options.’ Click ‘More Options’ to explore additional actions you can take with your FD.
● Renewing or Closing the FD: If your FD is not set for auto-renewal, click ‘Closure’ and select ‘Renew FD’ to initiate the renewal process.
● Submitting Details: After selecting ‘Renew FD,’ provide the necessary details, including your corresponding debit card information to proceed with the renewal.
● Verification: Before finalising the renewal, carefully review all the entered details to ensure accuracy and correctness.
● Confirmation: Once confident that all the details are correct, click ‘Submit’ to confirm your renewal request.
And that's it! With a few simple taps, you would have successfully renewed your FD using the iMobile Pay App. There is no need to visit the bank or go through lengthy paperwork; the iMobile Pay App offers a convenient and efficient way to manage your FDs on the go.
This can be done similarly online right here on the ICICI Bank website.
Why Choose iMobile Pay App for FD Renewals?
The iMobile Pay App is designed to provide you with a seamless and user-friendly banking experience. It empowers you to manage your finances efficiently and access a wide range of banking services at your fingertips. With its secure login using fingerprint authentication, you can be confident that your financial information remains protected.
Benefits of Renewing FDs through the iMobile Pay App:
● Convenience: Avoid visiting a branch or standing in long queues. Renew your FD from the comfort of your home or on the go.
● Time-Saving: The iMobile Pay App's intuitive interface streamlines the renewal process, saving time and effort.
● Real-Time Access: Stay updated with your FD details, including maturity amount and date, in real-time.
● Secure Transactions: With advanced security features like fingerprint login and financial transactions, remain secure and private.
● Immediate Confirmation: Receive instant confirmation of your renewal request, ensuring a smooth and efficient process.
Renewing your FD through the iMobile Pay App further establishes ICICI Bank's commitment to providing customers with innovative and convenient banking solutions. With just a few taps, you can grow your savings and achieve your financial goals easily. Embrace the power of the iMobile Pay App for seamless FD renewals and explore a world of convenience in your banking journey.
Auto-renewal is a valuable feature offered by ICICI Bank and various other financial institutions, streamlining the FD renewal process for investors. It ensures continuous earnings, convenience and rate protection. However, every investor should carefully consider their investment goals, liquidity needs and prevailing interest rates before opting for it. By understanding the process and considering their financial objectives, investors can make informed decisions and maximise the benefits of FDs.
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