How to Break FD in SBI: Complete Guide to Premature Withdrawal

Introduction

When life throws an unexpected financial requirement at you, your fixed deposit (FD) may be the easiest source of funds. If you have an FD with the State Bank of India (SBI), India’s largest bank, you can break it anytime before its maturity date. This process is known as premature withdrawal. But many people don’t know how to break FD in SBI, especially how to break FD online without visiting a branch.

In this guide by Ultra, we will explain:

• How to break SBI FD online

• How to close FD in SBI offline

• Premature withdrawal penalty

• Key things to remember

• Frequently asked questions

Let’s get started.

How to Break FD in SBI Online

Thanks to SBI’s digital banking services, closing a fixed deposit online is simple if you have an internet banking account. Here’s how to do it step-by-step:

Step 1: Log in to SBI Internet Banking

• Visit onlinesbi.sbi

• Enter your username and password.

Step 2: Navigate to Fixed Deposits

• Go to ‘Fixed Deposit’ section under the ‘e-Services’ or ‘Deposit & Investments’ tab.

Step 3: Select the e-TDR/e-STDR Account

• Click on ‘Close A/C Prematurely’.

• A list of your active FDs will appear.

Step 4: Choose the FD to Break

• Select the specific FD you wish to close.

• Verify the details — FD amount, tenure, maturity date.

Step 5: Confirm Closure

• Read the terms and confirm you want to close the FD prematurely.

• The principal amount along with interest (adjusted for penalty, if applicable) will be credited to your linked savings account instantly.

How to Break FD in SBI Offline

If you prefer traditional banking, you can break your FD by visiting your home branch. Here’s what to do:

Step 1: Visit SBI Branch

• Go to your SBI home branch where your FD was opened.

Step 2: Fill the FD Closure Form

• Ask for a FD premature withdrawal form.

• Fill in details like FD account number, your savings account number, and your signature.

Step 3: Submit Documents

Submit the filled form with your FD receipt (if available) and valid identity proof.

Step 4: Collect Acknowledgement

• The branch will process your request.

• The amount will be transferred to your savings account, usually within the same working day or the next.

SBI FD Premature Withdrawal Penalty

When you break an SBI FD before maturity, the bank imposes a penalty. Here are key points:

• The penalty is typically 0.50% to 1% lower interest than the contracted rate for the period the FD was held.

• For example, if you booked a 2-year FD at 6.50% but break it after 1 year, you’ll get interest for 1 year minus 0.50% or 1% penalty.

• Senior citizens usually get some benefit but may still face a penalty if the FD is broken before 5 years.

Note: There is no penalty if the FD amount is below ₹5 lakh and held for more than 7 days.

Can You Break Tax-Saving FDs in SBI?

No. SBI’s 5-year tax-saving FD cannot be closed prematurely except in case of the depositor’s death.

Key Tips Before Breaking an SBI FD

• Check if you have other sources of funds before breaking your FD.

• Compare if taking a low-interest personal loan against FD is better than premature closure.

• If you’re breaking multiple FDs, choose the one with the shortest remaining tenure to reduce penalty impact.

• Always check the current penalty clause on SBI’s official website or with your branch.

Is Breaking an FD Online Safe?

Yes. SBI’s online banking is secure, and breaking your FD online is quick, convenient, and safe as long as you don’t share your login credentials.

Benefits of Using SBI Online for FD Closure

• Convenience: No need to visit the branch.

• Instant Credit: Amount is credited instantly to your linked savings account.

• Track Record: Your e-TDR/e-STDR statement stays updated.

Frequently Asked Questions (FAQs)

1. How to break FD online in SBI?

Log in to onlinesbi.sbi, go to Fixed Deposit > Close A/C Prematurely, select your FD, and confirm closure.

2. Can I break my SBI FD before maturity?

Yes, SBI allows premature withdrawal anytime, except for tax-saving FDs.

3. Is there any penalty for breaking FD in SBI?

Yes, usually 0.50% to 1% is deducted from the applicable interest rate for the period the FD was held.

4. How long does it take for the amount to be credited after closing an FD?

For online closure, it is instant. For branch closure, it usually takes one working day.

5. How to avoid FD penalty in SBI?

If your FD is below ₹5 lakh and held for over 7 days, there may be no penalty. Otherwise, consider taking a loan against FD instead of breaking it.

Final Thoughts

Breaking an SBI FD is simple, whether you do it online or offline. Always check the penalty and alternatives like loans against FD to save on interest loss.

If you hold FDs with other banks, we have written an easy guide on how to break HDFC FD too — check it out for a step-by-step process for HDFC Bank customers.

At Ultra, we help you stay informed about your investment choices — whether it’s an FD, mutual fund, or other fixed-income products. For more guides on banking and smart investing, keep visiting Ultra.