Fixed deposit is the best way to park your savings. Fixed deposits are term deposits that allow you to build on your savings over a period of time. In case of an investment in fixed deposit, a fixed rate of interest is paid on the fund deposited till the maturity date. Fixed deposits are safe and come with guaranteed returns and has an added advantage of withdrawing funds before the maturity.
There are different kinds of fixed deposits offered catering to different needs of individuals. Some banks offer fixed deposits especially catering to children and senior citizens. Fixed deposit schemes for children isn’t much different from the regular fixed deposit schemes. These schemes allow parents or guardians to invest in fixed deposit accounts on behalf of their children.The guardian will be in charge of the account until the child reaches the age of maturity or the maturity of the plan, whichever comes first. Some of the fixed deposits schemes for children offer additional protection in form of insurance while others just offer payout at maturity.
Fixed deposit schemes in India for Children
There are a lot of banks in India that offer fixed deposit schemes for children. Under most of these schemes, the parent or guardian handles the account until the child reaches the age of maturity. Listed below are some of the top fixed deposit schemes for children and their features.
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PNB Balika Shiksha Scheme-
This is a fixed deposit account offered by PNB especially for the girl child. All girls who have passed grade 8th are eligible for the scheme irrespective of whether they belong to SC/ST. The deposit amount can be withdrawn when the girl reaches 18 years of age. Students of private unaided school and central government schools are not eligible for this plan. Interest on bank deposit is exempted from Income tax.
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Allahabad Bank Sishu Mangal deposit scheme-
This scheme offered by Allahabad Bank was launched in 1988.The scheme focuses on the welfare of children. It is a fixed deposit scheme for minors between the age of 1-15.Under this scheme, the account will be opened under guardianship and a predetermined amount should be deposited.Any child with an Indian citizenship between the age of 1-15 is eligible for this scheme. Interest will be paid on the amount deposited until the maturity of the plan.There is limit on the maximum amount deposited under this scheme.
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Fixed deposits under guardianship for minors-
There are only a few banks that have special fixed deposit schemes catering just for children. But many banks allow children to open a regular fixed deposit account provided that they have a guardian who will handle the account.
In these schemes, the guardian opens the fixed deposit account on behalf of the minor and once the minor reaches the age of maturity they can handle the account. Some banks even offer discounts for minors who open a fixed deposit account with them.
Listed below are some of the banks that allow a minor to open a fixed deposit account.
- Canara Bank
- HDFC Bank
- Bank of India
