Fixed Deposit Receipt (FDR)

When you purchase clothes from a store, the shopkeeper gives you an invoice or a receipt for the same. This receipt acts as proof of purchase from that store. It contains details about size, return policy, barcode number, etc. Similarly, financial institutions give you an FD receipt to acknowledge that you opened an FD account with them. A Fixed Deposit Receipt (FDR) is a document given to the investor by the bank, NBFC, or Post Office after investing in an FD. It acts as proof of investment in the FD.

Fixed deposit receipts contain various details, such as tenure, interest rate, maturity date, etc. The FDR has all the details of your fixed deposit account and is significant in many aspects.

In this article, we will learn about all the aspects of FDR, such as its components, its purposes, and points to consider when accepting an FDR.

A FDR contains information about the deposit and deposit holder. The components of a Fixed Deposit Receipt include the following:

There could be mistakes, whether while filling the form or generating the FDR. Therefore, checking that all the details are correctly mentioned on the Fixed Deposit Receipt is crucial. So, do check the following details on your FDR:

• Deposit Tenure: The tenure or investment you selected must be mentioned correctly in the FDR.
• Rate of Interest: Cross-checking the rate of interest is one of the most important things to do. The rate of interest remains the same throughout the tenure of the fixed deposit (except for some recently launched products by some private banks). However, at the time of renewal, the bank may change the interest rates on FDs. So, make sure whether the rate of interest is the same or has changed.
• Maturity Date: You must check the maturity date mentioned in the FDR as it helps you access your deposit at the right time. If you are planning a trip or purchasing a gift for someone with your FD’s maturity amount, knowing the date of maturity will make sure you have funds at the right time.
• Auto-Renewal: If you opt for auto-renewal, the details will be mentioned. If not, you must visit the bank on or after the maturity date to renew or withdraw.
• Prepayment Penalty: The terms of the prepayment penalty will be mentioned on FDR. You must check those terms because you may need to withdraw the deposit before the maturity date. Usually, the bank may allow you to withdraw funds at a 1% lesser rate of interest than the predetermined rate. However, the terms regarding penalty vary from bank to bank. NBFCs and post offices have their own terms regarding prepayment penalties. So, you need to check those terms carefully.
• Nominee Details: You must check whether the nomination details you mentioned while filling out the FD account opening form are correctly mentioned in the FDR. In case of the unforeseen demise of the investor, the nominee receives the amount.

1. Renewal: If you opted for an offline FD, your bank might ask you to present the FDR while renewing your FD after maturity. Moreover, if you want to opt for a different tenure upon maturity, you need to surrender the existing FDR, after which you will be provided a new one.
2. Premature withdrawal: In an emergency, you may need to withdraw the deposit amount before maturity. In such cases, you need to present an FDR to prove ownership. The bank will take the FDR from you and provide the money.
3. For availing loans: Apart from capital preservation and fixed returns, FDs offer the option of availing loans against them. Many financial institutions provide loans against FDs at a lower interest rate than usual. To take a loan against your fixed deposit, you need to submit the FD receipt per the financial institution's terms. Once you repay the loan, the FDR will be returned to you with revised details.

The FDR in banking is the most critical document for an FD account. Without this half-page document, there is no proof of your investment, and there is no way to withdraw your deposit or avail a loan against the FD. The way a payment receipt acts as proof of purchase after shopping in a clothing store, an FDR acts as a receipt of your deposit in the financial institution. Once you open an FD account with a bank, NBFC, or post office, ensure that you get a fixed deposit receipt with all the details mentioned correctly. You must keep it safe until you close the FD account.