Union Bank rolls out a monthly recurring deposit scheme; all you need to know

 

Union Bank of India has rolled out a unique recurring deposit – Union Monthly Plus -- that gives customers the flexibility to increase or decrease the monthly amount.  The Union Monthly Plus is a cumulative deposit scheme aimed at lower/lower middle/middle/upper middle and salaried sector. Accountholders having an individual in his/her own name and those with more than one individual in their joint names with suitable repayment instructions can utilise this account.

Besides this, parents/guardians appointed by the Court operating a bank account on behalf of a minor can also hold this account. Those accountholders operating in the name of institutions, corporate, proprietorship, partnership, trust, HUF, etc. can also utilise the Union Monthly Plus scheme.

Users can utilise ‘Step Up’ as well as ‘Step Down’ options to adjust the monthly amount, i.e., “core amount” at the time of opening of the account and deposit the same as initial instalment. But how do the ‘Step Up’ and ‘Step Down’ options work?  Using the ‘Step Up’ option, depositors can increase the monthly instalment amount up to 10 times the Core Amount during any month. Customers can deposit multiple times in a month in this account and the maximum amount allowed per month is 10 times the core amount or Rs 1, 00,000, whichever is lower, as per Union Bank of India.

The ‘Step Down’ option, on the other hand, helps customers reduce the same in any subsequent month/s but it should not be less than the core. The minimum core amount that a user can have is Rs 100 and in multiples of Rs 100. The minimum period for which an accountholder can have this RD account is 6 months and the maximum period is 60 months.

Accountholders will get interest at quarterly intervals and the interest rate is calculated on daily product basis. Rate of interest on this scheme will be according to the Term Deposit rate applicable for the period. TDS (Tax Deducted at Source) will also be deducted as per government guidelines. There is no penalty for delayed instalments and premature closure.

Premature closure is allowed at a penalty, if any and accountholders will get interest for the run period at applicable rates. Automatic renewal is also not allowed under this scheme, as per the Union Bank of India.

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