IOB Loan Against FD: Features, Eligibility and Application

IOB Loan Against FD: Features, Eligibility, and How to Apply

Indian Overseas Bank (IOB) allows you to take a loan or overdraft against your fixed deposit, so you get instant access to funds without breaking your FD. You can borrow up to 90% of the FD amount, and your deposit continues to earn interest throughout the loan period.

Key Features of IOB Loan Against FD

• Loan amount: Up to 90% of the FD principal
• Interest rate: 1% to 2% above the FD interest rate
• Repayment tenure: Up to the FD maturity date
• Processing charges: Minimal or nil
• Prepayment: Allowed without penalty

Who Can Apply?

• Individual FD holders (resident Indians, single or joint accounts)
• Hindu Undivided Families
• NRI account holders for NRE/NRO FDs, subject to applicable conditions
• FD must be active and not under a non-callable lock-in

How to Apply for IOB Loan Against FD

1. Log in to the IOB Mobile app or internet banking at iob.in.
2. Go to Loans and select Loan Against Fixed Deposit.
3. Choose the FD you want to pledge.
4. Enter the loan amount up to 90% of FD value.
5. Review terms and submit the application.
6. Funds are typically credited to your account the same day.

For offline application, visit the branch with your FD receipt and fill out the loan application form.

Repayment Details

For overdraft accounts, interest is charged only on the utilized balance. For term loans, repayment is scheduled as EMIs up to FD maturity. Prepayment can be done anytime; the lien on the FD is lifted upon full repayment.

Key Takeaways

• IOB allows loans up to 90% of FD value without premature withdrawal.
• Interest is only 1% to 2% above the FD rate, making it low-cost borrowing.
• Apply online via IOB Mobile app or internet banking, or offline at the branch.
• The FD earns full interest even during the loan period.

Frequently Asked Questions

How much loan can I get against my IOB FD?

You can borrow up to 90% of your fixed deposit amount as a loan or overdraft from IOB.

What is the interest rate on IOB loan against FD?

The rate is 1% to 2% above the FD rate. Since the FD continues earning interest, the net cost is very low.

Can I apply for IOB loan against FD online?

Yes. The IOB Mobile app and iob.in internet banking portal allow you to apply online.

What happens to my FD when I take a loan against it?

A lien is marked on the FD. It continues to earn interest at the original rate. The lien is released when the loan is repaid.