Union Bank Loan Against FD: Eligibility and How to Apply

Union Bank Loan Against FD: How to Apply and Key Features

Union Bank of India offers overdraft or term loans against fixed deposits, allowing you to access funds without breaking your FD prematurely. You can borrow up to 90% of the FD value and continue earning interest on the deposit while repaying the loan.

Key Features of Union Bank Loan Against FD

• Loan amount: Up to 90% of the FD value
• Interest rate: Typically 1% to 2% above the FD interest rate
• Repayment tenure: Linked to the FD maturity date
• Processing fee: Nil or minimal depending on the scheme
• Collateral: The FD itself acts as security

Who Is Eligible?

• Individuals with an active Union Bank FD (single or joint holder)
• Resident Indians and NRIs (for NRE/NRO FDs, subject to conditions)
• Accounts with FDs in non-callable schemes may have restrictions

How to Apply for Loan Against FD at Union Bank

1. Log in to the Union Bank Mobile Banking app or visit the internet banking portal.
2. Navigate 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 the interest rate and repayment terms.
6. Submit the application. For online requests, the overdraft is usually activated within the same day.

Alternatively, visit your Union Bank branch with your FD receipt and a loan application form to apply offline.

Repayment and Foreclosure

You pay interest only on the amount utilized in overdraft accounts. For term loans, EMIs are scheduled up to the FD maturity. You can foreclose the loan at any time; the lien on the FD is released upon full repayment.

Key Takeaways

• Union Bank allows loans up to 90% of the FD value without breaking the deposit.
• Interest rate is typically 1% to 2% above the FD rate.
• Apply online via Union Bank Mobile Banking or visit the branch.
• The FD continues to earn interest even while pledged as collateral.

Frequently Asked Questions

How much loan can I get against my Union Bank FD?

You can get up to 90% of the fixed deposit value as a loan or overdraft.

What is the interest rate on Union Bank loan against FD?

The interest is charged at 1% to 2% above the FD rate. Since the FD still earns interest, the effective cost is low.

Can I apply for a loan against FD online at Union Bank?

Yes. The Union Bank Mobile Banking app and internet banking portal allow you to apply for a loan against FD digitally.

Does pledging FD affect its interest earnings?

No. Your FD continues to earn interest at the contracted rate even when pledged as collateral for a loan.