Canara Bank offers a variety of fixed deposits with high interest rates and minimum risk. Following are some of the key features of Canara bank fixed deposit account:
The Canara Bank FD calculator is an online tool that estimates the maturity and interest amount for an Fixed Deposit investment. It helps you in estimating the results in advance so that you make a well-onformed investment decision. The calculator needs the investment amount, tenure, rate of interest and compounding frequency as an input. You can easily adjust any of the inputs and get the results.
The calculator provides only an estimation of the wealth to be gained and maturity value. It does not intent to assure any returns.
The Canara Bank FD calculator uses the input provided by you, processes it and provides the output. The input details are investment amount, interest rate, compounding frequency, tenure and payout period. It provides the wealth gained and maturity amount as an output. You can use Canara Bank FD calculator with 2 different approaches i.e. investment amount and target amount.
With the investment amount approach you can easily estimate the wealth gained and maturity. This method is useful if you already have the return on investment when you already have an investment amount in hand.
You need to follow the following steps to use this approach:
The target amount approach is helpful if you have a target maturity amount in mind. The calculator does a back calculation based on the target amount. It provides the initial investment amount you need to invest today to earn the target maturity amount. This way you can ensure that you have correctly invested and avoid any shortcomings in your returns.
You need to follow the following steps to use this approach:
The estimation of the interest and maturity amount depends on a number of factors. Such important factors are interest rate, tenure, periodic payout, compounding frequency, and investment amount. The Canara Bank FD interest is calculated using 2 methods i.e. simple interest and compound interest.
Simple interest is the interest earned on the investment amount for a given period of time at a predetermined interest rate. The simple interest is calculated on the tenure of the fixed deposit. Moreover, if the tenure is less than 181 days the simple interest is applicable on Canara Bank FD.
Simple Interest Formula – (P * R * T)/ 100
P = Principal amount of investment, R = Rate of FD Interest (%), T = Tenure of investment
Let us understand the calculation with the help of an example
Mr. Amar invested Rs 600,000 in Canara Bank fixed deposit on 1st January 2021 for a maturity tenure of 90 days for a rate of interest of 12% per annum.
P (the investment amount) = Rs 600,000, R (rate of interest) = 12% per annum, T (tenure) = 90 days
Maturity Date = 31st March 2021
Simple interest = (P * R * T)/ 100
Simple interest = (Rs 600,000 * 12 * 90 days) / 100 * 365 days
Simple interest = Rs 17,753
Maturity amount on FD = Principal Investment Amount + Interest Earned
Maturity amount on FD = Rs 6,00,000 + Rs 17,753
Maturity amount on FD = Rs 6,17,753
Compound interest is the interest earned on the principal amount invested and the interest earned. The interest rate is raised to the number of periods (years) for which the interest will be compounded and multiplied to the principal amount invested. Because of the power of compounding the tenure of investment and frequency of compounding is the most important factor. The interest earned in the previous period is added to the opening balance. This way the higher the frequency and tenure higher the interest will be on FD.
It is very evident that an FD with a higher frequency with no payout during the tenure will earn higher interest than FD with a frequent payout FD. If the tenure is more than 181 days on Canara Bank FD then compound interest will be applicable. It is better to invest for a period of more than 181 days to earn compound interest rather than simple interest.
Compound Interest Formula
A = P (1+r/n) ^ (n * t)
A = Maturity Amount, P = Principal amount invested, r = Rate of Interest (in decimals), n = number of compounding in a year, t = number of years
Mr. Anil invests Rs 6,00,000 for a period of 1 year at a rate of interest of 12% per annum compounded quarterly.
Principal amount = Rs 6,00,000, Interest Rate = 12% per annum compounded half-yearly, Number of compounding in a year = 4 (once every 3 months),
Number of years of investment is 1 year
Total compounding = 4 * 1 year = 4 compounding
A = 6,00,000 (1+0.12/4) ^ (4*1)
A = Rs 6,75,305
Interest amount = Rs 6,75,305 – Rs 6,00,000 = Rs 75,305
Yes, FD investment in Canara Bank is safe. The rate of interest is predetermined and does not change during the tenure of the FD. The interest rate remind the same irrespective of the market fluctuation and inflation. Further, the Deposit Insurance and Credit Guarantee Corporation insures a fixed deposit of up to Rs 5 lakhs. Hence, in case there is any default in the payment of the maturity the DICGC will cover the losses, if any.
The highest Canara Bank FD interest rate is 5.30% for a regular investor for the tenure of 3-10 years. Also, for the same tenure, the senior citizen FD interest rate is 5.80%.Also, returns from Canara Bank fixed deposits can be calculated using Canara Bank FD calculators. One can use Scripbox’s Canara Bank fixed deposit calculator to calculate an FD investment’s maturity amount.
Canara Bank offers loan and overdraft facility against term deposit investment. Investors can get up to 90% against the deposit amount. The interest rate on Canara Bank FD loan is 5.5%-7.4%. It will give a loan against Canara Bank FD only. Also, the tenure of the loan is limited to the tenure of the FD. Moreover, investors cannot get a loan on tax-saving FDs.Loans such as home loan (loan against property), business loan, education loan, etc., can be taken against Canara Bank FD.
Canara Bank FDs offer premature withdrawal facility on their FDs. However, they charge a penalty on the same. Also, the penalty for premature withdrawal is 1% on the contracted interest rate. Furthermore, Canara Bank will not charge a penalty if the investment is withdrawn with seven days of investment.
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