Systematic Deposit Plan (SDP) is a perfect combination of flexibility of investment as in the case of recurring deposits; along with high-interest rates as in the case of fixed deposits. In an SDP, you don’t need a lump sum to invest like fixed deposits. You can invest a small amount on a monthly basis and earn high interest on it till a fixed tenor. SDP provides flexibility in terms of the number of deposits as well as tenor.
Bajaj Finance offers two options under SDP for investment –
- Monthly Maturity Scheme
- Single Maturity Scheme
Both of these will be discussed further here.
On the other hand, Flexi fixed deposits are majorly known for their liquidity feature and available with most of the banks and financial institutions. These are specialized in providing facilities like savings accounts along with good rates of returns. Such FDs have the advantage of withdrawing a certain amount from the savings or current bank account that has been linked with the Flexi fixed deposit scheme.
An online FD maturity calculator can help you check the profitability of an FD.
Systematic Deposit Plans (SDP)
There are two schemes under the Systematic Deposit Plans that will suit different kinds of investors. There is a common application form for both the SDP schemes. The first deposit will be paid through internet banking, e-mandate, or Account Payee Cheque so that the investor’s details can be verified and the bank account gets registered. You will need to submit a NACH mandate for subsequent deposits.
1. Monthly Maturity Scheme
You have the option to invest in 6 to 48 deposits here. You can choose the tenor (between 12 to 60 months) as per your convenience. It will be applied to all the deposits you have selected to invest in. And each of your deposits will mature on dates exactly that many months ahead, depending on your choice of tenor.
2. Single Maturity Scheme
The maturity dates of all your deposits will be held on a single day. Here the tenor of each deposit will gradually reduce in such a way that all of the deposits placed mature on a single date.
Following are the options to choose from for the number of deposits and the tenure:
Maturity payout of all deposits Number of deposits (excl. 1st deposit)
After 24 months of first deposit 6 — — —
After 36 months of first deposit 6 12 — —
After 48 months of first deposit 6 12 24 —
After 60 months of first deposit 6 12 24 36
If you choose the tenor as 48 months, and the number of deposits as 6 (after the first deposit made) for booking a Single Maturity Scheme. If the plan is started on April 1, 2020, and every deposit deduction is to be done on the 7th of every month. As per the above table, the tenure of every deposit will be as follows:-
SDP 1 Cheque Payment 01-Apr-20 01-Apr-24 4 Years, 0 Months, 0 Days
SDP 2 NACH Payment 07-May-20 01-Apr-24 3 Years, 10 Months, 29 Days
SDP 3 NACH Payment 07-Jun-20 01-Apr-24 3 Years, 9 Months, 29 Days
SDP 4 NACH Payment 07-Jul-20 01-Apr-24 3 Years, 8 Months, 29 Days
SDP 5 NACH Payment 07-Aug-20 01-Apr-24 3 Years, 7 Months, 29 Days
SDP 6 NACH Payment 07-Sep-20 01-Apr-24. 3 Years, 6 Months, 29 Days
SDP 7 NACH Payment 07-Oct-20 01-Apr-24 3 Years, 5 Months, 29 Days
SDP vs. Flexi -FD
Upon comparing the Systematic Deposit Plan (SDP) with the Flexi FD scheme, the following are the competitive benefits of SDP:
1. Flexibility to choose tenure:
You can choose deposit tenure as per your needs. You can invest as long as you want to achieve your financial goals. There is the option to choose tenure from 12-60 months. Even you have the option to choose a day for your monthly deposit as per your convenience – 3rd, 7th, or 12th every month and it will be fixed for the rest of the deposits.
2. Flexibility to Choose Your Investment Amount:
A Systematic Deposit Plan can be started with a deposit of Rs.5,000 per month only.
3. Easy Payment Method:
The first payment for deposits is to be done by the depositor through cheque. Subsequent payments will be deducted from the bank account. The depositor needs to issue NACH e-mandate in favor of Bajaj Finance Limited and get it registered with his bank.
4. Rate of Interest:
The rate prevailing on the date of each monthly deposit will apply to that particular deposit.
5. Premature Withdrawal:
SDP offers the facility of premature withdrawal after 3 months from the starting date of deposit.
6. Loan Against Deposit:
This is a beneficial feature for depositors. They can avail loan against each deposit under SDP as per the norms of financial institution.
7. High Stability and Credibility:
Bajaj Finance FD is a trustworthy instrument accredited with highest CRISIL and ICRA ratings. SDP is one of the safest deposits.
After knowing such advantages, you can invest confidently in the smart Systematic Deposit Plan from Bajaj Finance. Senior citizen FD rates with Bajaj Finance are also lucrative and are 0.25% higher than regular FD interest rates.