What is Indian Bank Tax Saving FD Scheme
Indian Bank's IB Tax Saver Scheme is a fixed deposit offering a fixed interest rate and tax benefits under Section 80C. It has a five-year lock-in, a maximum tenure of 10 years, and accepts investments of up to Rs.1.5 lakh a year. Senior citizens earn an additional rate of interest over the general rates shown below.
Senior citizens are eligible for 0.50% additional interest. You can invest up to Rs.1.5 lakh in this scheme in a given financial year.
Key features of Indian Bank Tax Saver Scheme
Here are the key features of Indian Bank Tax Saver Scheme:
- The customers should follow Know Your Customer (KYC) procedures while opening Tax Saver account.
- The lock in period of this Fixed Deposit (FD) scheme is five years.
- The minimum and maximum investment amount are Rs.1,000 and Rs.1,50,000 respectively.
- The Hindu Undivided Family (HUF and individuals can claim for the tax rebate.
- The customers cannot withdraw money for five years.
- It also has a nomination facility.
- The scheme does not provide any loan facility to the customers.
- It provides a fixed rate of interest.
- The scheme is available under both Fixed Deposit (FD) and Money Multiplier Deposit (MMD) formats.
Eligibility Criteria for Applying for Indian Bank Tax Saver Scheme
This scheme is open to Resident Individuals and Hindu Undivided Families.
Features of Indian Bank Tax Saver Scheme
Account Type | Joint/Single |
Amount | Minimum: Rs.1,000, and in multiples of Rs.100 thereafter. Maximum: Depositors that have registered their PAN card details can invest up to Rs.1,50,000 every financial year. |
Interest | Interest is applied quarterly. Depositors can also choose to receive interest monthly at a discounted rate, or let it accumulate for payment on maturity. |
Period | Minimum: 5 years Maximum: 10 years |
Indian Bank Tax Saver Scheme interest rates
The interest rates for Indian Bank Tax Saver Scheme effective from 04 August 2026 are given below:
Tenure | Interest Rates for General Public (p.a.) | Interest Rates for Senior Citizen (p.a.) |
5 year | 6.00% | 6.50% |
5 years to 10 years | 6.00% | 6.75% |
Note: The interest rates are effective from 04 August 2026.
Summary
The IB Tax Saver Scheme is Indian Bank's fixed deposit for depositors seeking a tax deduction under Section 80C of the Income Tax Act, along with a fixed rate of interest. It carries a five-year lock-in, can be extended up to 10 years, and does not permit loans or premature withdrawal within the lock-in. Review the current interest rates and eligibility details above before opening an account with Indian Bank.
FAQs on Indian Bank Tax Saver Scheme
1.What is the IB Tax Saver Scheme?
The IB Tax Saver Scheme is Indian Bank's fixed deposit that lets depositors claim a tax deduction under Section 80C of the Income Tax Act. It combines a fixed rate of interest with a mandatory lock-in period, making it suited to savers who also want to reduce their taxable income. The scheme is open to Resident Individuals and Hindu Undivided Families.
2.Who is eligible to open an IB Tax Saver Scheme account?
Resident Individuals and Hindu Undivided Families are eligible to open an IB Tax Saver Scheme deposit with Indian Bank. Depositors must complete the bank's KYC procedures before the account can be opened. The account can be held singly or jointly.
3.What is the lock-in period under the IB Tax Saver Scheme?
The IB Tax Saver Scheme carries a mandatory lock-in period of five years, during which the deposit cannot be withdrawn. Depositors can choose to extend the tenure beyond the lock-in, up to a maximum tenure allowed under the scheme. This lock-in is what qualifies the deposit for the Section 80C tax benefit.
4.Can I take a loan against my IB Tax Saver Scheme deposit?
No, Indian Bank does not offer a loan or overdraft facility against an IB Tax Saver Scheme deposit. The scheme also cannot be foreclosed before the lock-in period is complete. This restriction is tied to the deposit's Section 80C tax status.
5.Does the IB Tax Saver Scheme offer a nomination facility?
Yes, the IB Tax Saver Scheme includes a nomination facility, so depositors can name a beneficiary for the account. This is in line with Indian Bank's other term deposit offerings. Nomination details can be added or updated at the branch where the account is held.
6.How is interest paid under the IB Tax Saver Scheme?
Interest under the IB Tax Saver Scheme can be applied quarterly, taken monthly at a discounted rate, or left to accumulate and be paid out on maturity, depending on the option the depositor selects. The exact choice is confirmed with Indian Bank at the time of opening the account. Applicable rates are listed in the table above.
7.How much can I invest in the IB Tax Saver Scheme?
Indian Bank sets a minimum and maximum investment amount for the IB Tax Saver Scheme, with the maximum linked to the annual limit allowed for tax deduction under Section 80C. These amounts are listed in the table above. Depositors who have registered their PAN with the bank can invest up to the maximum limit in a financial year.
Prerna Surana is a Finance Content Writer with over three years of experience at Bank Bazaar. She specialises in creating insightful content on Credit Cards, Debit Cards, Taxes, and other BFSI products. Beyond finance, Prerna also writes about non-financial utility products such as Aadhar Card, Voter ID, and Government Certificates.
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