Bandhan Bank Fixed Deposit offers investors high interest rates at minimum risk. Following are some of the key features of a Bandhan Bank FD account:
Bandhan Bank FD Calculator is a simple online tool that helps in estimating the returns from an FD investment. Furthermore, the FD calculator only requires simple inputs like tenure in years, rate of interest, investment amount, and target amount. The output Bandhan Bank FD calculator provides aids in better financial planning.
However, one must understand that the Bandhan Bank FD Calculator only provides an estimation and doesn’t guarantee any returns. Also, the actual return might vary, and the exact maturity amount will be known only after one invested in Bandhan Bank FD.
It is a good idea to assess the prospective return on an investment before making a decision. This aids in more effective investment planning. In other words, if the returns are measured in terms of money accumulated rather than a percentage, one can better plan their goals. There are two ways one can estimate the returns from FD investment using Scripbox Bandhan Bank FD Calculator: investment amount approach and target amount approach.
Following are steps that you can follow to use the Bandhan Bank FD Calculator using the Investment Amount Approach:
After all the inputs are entered, the Bandhan Bank FD calculator automatically shows the interest and maturity amount. The Bandhan Bank FD calculator shows a tabular format of the interest earned each year along with the opening and closing balance. Moreover, the Bandhan Bank FD calculator gives a graphical representation of the initial investment and maturity amount.
While the investment amount approach requires an individual to enter the investment amount, the target amount approach estimates the investment amount based on the amount one expects from the Bandhan Bank FD investment. Following are the steps that one needs to follow to use the Bandhan Bank FD Calculator using the Target Amount Approach:
The Bandhan Bank FD calculator gives the investment amount needed to achieve the target and estimates the interest one might earn. Moreover, the Bandhan Bank FD Calculator shows a tabular representation of opening balance, interest earned and closing balance for each year.
The interest amount from Bandhan BankFD investment depends on a number of factors such as investment amount, tenure of the FD, compounding frequency, and the rate of interest. One can estimate the interest earned from Bandhan Bank FD using two methods, namely, simple interest and compound interest. Let us understand the calculation of interest and maturity amount using both the methods with the help of an example.
Simple interest is the income or reward that one earns for investing money for a predetermined period at a fixed interest rate.
Simple Interest = (P * R * T)/ 100
P- Initial investment amount, R- Interest rate of Bandhan BankFD (%), T- Tenure of the Bandhan BankFD
Ms Sanjana wants to invest INR 450,000 for 7 years at an interest rate of 7.5% per annum.
For Ms Sanjana, the principal amount (P) is INR 45,000, rate of interest (R) is 7.5%, and tenure (T) is 7 years.
Simple Interest = (INR 45,000 * 7.5 * 7 years)/ 100 = INR 23,625
Maturity Value = Investment + Simple Interest earned during the tenure of investment
Maturity Value = INR 45,000 + INR 23,625
Maturity Value = INR 68,625
Compound interest is the income that the investor earns on the principal and accumulated interest. In simple terms, compounding is earning interest on interest. A longer the duration of the investment, and higher the number of compounding periods along with lower interest payout frequency will result in higher interest income when compared to lower number of compounding periods and high interest payout frequency.
A = P (1+r/n) ^ (n * t)
A = Amount at maturity, P = Investment, r = Rate of interest (in decimals), n = number of times interest is compounded, t = investment duration in years
Ms Sanjana wants to invest INR 45,000 for seven years at an interest rate of 7.5% per annum, compounded quarterly.
For Ms Sanjana, the principal amount (P) is INR 45,000, rate of interest (r) is 7.5%, tenure (t) is seven years, and the number of compounding periods is 4 (n)
Maturity Amount = 45,000 (1+0.075/4) ^ (4*7)
A (maturity amount) = INR 75,701.75
Interest income = INR 75,701.75– INR 45,000 = INR 30,701.75
You may also like to read about the Bandhan Bank Savings Account Interest Rates
The Bandhan Bank fixed deposit interest rate ranges between 3% to 6% p.a. The Bandhan FD rates for senior citizens range between 3.75% to 6.75%.
The highest FD rate for Bandhan Bank is 6% for a regular investor for the tenure of 1.5-3 years. Also, for senior citizens, the highest Bandhan Bank FD interest rate is 6.75%.
The Deposit Insurance Scheme insures the Bandhan Bank deposits up to INR 5,00,000, hence Bandhan fixed deposits are considered safe.
To know in how many years a FD with Bandhan Bank will double, we can follow the 72 rule. We have to divide 72 by the interest rate, and the result will be the number of years Bandhan Bank FD will double. For example, for a tenure of 7-10 years, the Bandhan Bank FD interest rate is 7.5%. An investor can double the investment amount by investing for this tenure in Bandhan Bank FD in 9.6 years (72/7.5).
Investors can avail of a loan against their Bandhan Bank FD. Hence, Bandhan Bank provides investors with an opportunity to meet their liquidity requirements without breaking their FD. Also, Bandhan Bank offers loans only on 90% of the deposit amount, and the interest rate is 1.5%-2% above the FD rate. The terms and conditions of the loan vary as per Bandhan Bank norms.
Bandhan Bank allows its investors to withdraw the deposit amount prematurely. However, Bandhan Bank charges a penalty for premature withdrawal. The terms and conditions of premature withdrawal depend on Bandhan Bank norms.
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