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How To Activate Or Claim An Unclaimed Or Matured Fixed Deposit?
xxxx The popularity of an FD as an instrument of investment is well-known. After all, fixed deposits combine the idea of savings and liquidity in one investment vehicle. This, in turn, makes a fixed deposit easily accessible in cases of financial contingencies.
 
But what if, these very deposits lie unclaimed post-maturity?
 
One might pose a question about the possibility of such an occurrence. But such instances are highly possible only when:
 
The investor exits the country.
 
Death of the investor and absence of nomination on the FD investment made.
 
Also, very rarely, the investor might as well forget about his investment that has been left untouched in a long time. Quite significantly, this problem of unclaimed deposits also happens when investment portfolios become too cumbersome for investors to manage. Inconvenience in management arises due to multiple small investments made in different schemes with varying FD interest rates.
 
What happens if this amount does not receive claims?
 
In cases where no one comes to claim the amount even after a considerable period of time, the easiest way out for financing institutions is to transfer the amount over to a nominee. This method is relevant only when the investors are no more, and he/she has duly nominated someone to claim the investment in the event of his/her death. 
 
What happens if investors don’t have a nomination for their investments?
 
Under such circumstances, financing institutions can resort to two alternatives.
 
  • They could track down legal heirs of investors and inform them accordingly. Following which, these financial institutions could take appropriate steps to hand them their dues. These amounts are inclusive of interest amounts at FD interest rates pertaining to the time of transferring these investments.
  • In case, the depositor is alive; these companies might opt to reinvest the money at ongoing FD interest rates, after informing the investor accordingly.
 
How do legal heirs claim their unclaimed amounts?
 
Where investors are no more and legal heirs have claimed outstanding deposit amounts, legal heirs have to conform to the following documentary requirements:
 
  • Submission of the investors’ death certificates.
  • Submission of KYC documents for validating their respective identities.
Some might ask, what if the investor is still alive?
 
After the institution has duly informed customers, they must complete required documentation procedures as determined by the institution. In addition to that, investors must submit KYC documents as necessary. 
 
Moreover, the investor must possess the FD receipts that specify the amount of initial investment, and relevant FD interest rates. This receipt must be produced at the time of making a claim. 
 
As mentioned earlier, investors might as well opt for reinvesting the amount in consultation with the company. The company, in turn, re-invests the amount at prevailing FD interest rates. 
 
Information to ponder on – 
 
However, the procedure for claiming these unclaimed deposits can take a considerable period of time, owing to the company’s due diligence process. Therefore, it is always advisable for investors to keep track of their investments. 
 
When investors are duly aware and updated of their investment schedules, it becomes easy for them to monitor their returns as well. For example, while pre-planning a particular investment in a fixed deposit, one could always use FD calculators
 
FD calculators allow investors to have a clear preview of interest and maturity amounts accruing to them after they actually invest. Also, experts advise investors to keep nominations for their investments, at the time of making an investment.
 
Another viable alternative is to keep a joint holder. In the event of the death of one investor, the joint holder could always take the amount accrued. 
 
For smooth, convenient investments, one could always opt for a financing house bearing semblance to Bajaj Finserv. Such financing institutions provide investments at fairly high FD interest rates compared to banks. Plus, the process of online application not only saves time but also provides the convenience of online nomination.
 
Thus, in the presence of institutions one need not worry about his/her investments thereof. Such institutions combine safety with convenience; thereby, investors would find these institutions worthy of their investments.
 
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    COMMENTS

    JAGRUTI SHAH

    5 months ago

    Test comment

    HDFC cuts lending rate by 15 basis points
    HDFC Ltd, one of the largest housing finance company, on Thursday announced a 15 basis points (bps) reduction in its retail prime lending rate (RPLR). This reduction would benefit all existing customers, the lender said.
     
    For all new home loans of up to Rs75 lakh, interest rates for women customers would be 8.65% and for others, it would be 8.70% per annum, HDFC said in a release.
     
     
    The reduction in the RPLR will also be applicable on loans to non-resident Indians (NRIs)/ persons of Indian origin (PIO) card holders.
     

     

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    How the credit linked subsidy scheme- CLSS works
    The Pradhan Mantri Awas Yojana (PMAY)– Housing for All aims at addressing the shortage of 20 million slum and non-slum urban poor households, by 2022. Under the PMAY, central assistance will be provided to the Urban Local Bodies (ULB) and other implementing agencies through union territories (UT) and states for the following –
     
    1.  In-situ rehabilitation of existing slum dwellers using land as a resource through private participation 
       
    2. Credit linked subsidy scheme (CLSS)
       
    3. Affordable housing in partnership 
       
    4. Subsidy for survey-led individual house construction or enhancement
     
    Among the above CLSS is the only scheme that is implemented as a central sector scheme, rest will be implemented as a central sector sponsored schemes. The CLSS is aimed at increasing the institutional credit flow to the housing needs of the urban poor as a demand side intervention. 
     
    This Scheme is being implemented through two central nodal agencies – National Housing Bank (NHB) and Housing Urban Development Corp (HUDCO). Till date the Scheme has drawn a lot of traction from the housing finance industry with 185 primary lending institutions registered under the scheme, mostly represented by housing finance companies (HFCs). 
     
    This Scheme, certainly, would address the demand size issues of the affordable housing finance segment but there is matter of concern when it is looked at a bit closer. Under this scheme, upon the receipt of the subsidy, the entire amount is reduced from the effective loan amount at the inception of the tenure, which means the borrower will have to pay off only to extent of the principal, arrived at, after the adjustment of the principal. If the borrowers think of repaying the principal amount before the end of the loan tenure, the very intent of this Scheme will be defeated. 
     
    Let us understand this with the help of an example – say a homebuyer borrows Rs100 from an HFC against which a subsidy of Rs10 is allowed under the Scheme; therefore, the borrower will actually have to pay back Rs90 towards the principal. Now if the borrower decides to prepay the loan, it will have to pay principal to the extent of Rs90, while it received Rs100. So there will be a gain of Rs10 in the hands of the borrower.
     
    However, the merits in this Scheme are far more to cover this drawback.
     
    The Scheme
     
    The CLSS is applicable only for affordable housing loans availed by Economically Weaker Sections (EWS) and Low Income Groups (LIG) seeking housing loans from banks and housing finance companies and such other institution as may be eligible to be a part of this scheme. 
     
    Here the amount of interest subsidy allowed by the central government is apportioned directly against the principal outstanding of the loan amount at the very inception of the loan tenure.
     
    The quantum of interest subsidy will be at a rate of 6.5% for a tenure of 15 years or during the tenure of the loan, whichever is shorter, which is to be discounted at the rate of 9%. Let us understand this by way of an example.
     
    Principal – Rs1 lakh
     
    Tenure – five years or 60 months
     
    Rate of interest – 13% 
     
    The interest rate subsidy at the rate of 6.5% is to be calculated at the rate of 6.5% for a period of 60 months using the “IPMT” formula in Excel. The figures will look like – 
     
     
    The figure, as calculated above, is same as that of the amount of subsidy shown by the calculator prepared by the central government in this regard.
     
     
    There are additional conditions which should be satisfied in order to avail benefits under the Scheme and they are –
     
    1. Subsidy shall be available only in case of loans up to Rs 6 lakh;
       
    2. Credit linked subsidy would be available for housing loans availed for new construction and addition of rooms, kitchen, toilet etc. to existing dwellings as incremental housing;
       
    3. The carpet area of houses being constructed under this component of the mission should be up to 30 square metres and 60 square metres for EWS and LIG, respectively in order to avail of this credit linked subsidy.
     
    (Abhirup Ghosh works as Senior Manager at Vinod Kothari Consultants P Ltd)
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    COMMENTS

    Moorthy Ramachandaran

    3 years ago

    its good scheme .hove can we apply ...?

    Sonam yadav

    3 years ago

    I JUST WANT 6LAKH AMOUNT ARE GIVE FREE OR NOT BCOZ I WAS CONFUSED THEIR IS ANY INTERST RATE CHARGED PLZ CONFIRM ME

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