The Reserve Bank of India announced the interest rate for RBI Floating Rate Savings Bonds for January to June 2025 on January 1, 2025. How much interest will the RBI Floating Rate Savings Bond earn between January 1 and June 30, 2025? Read on to find out.The RBI Floating Rate Savings Bond (FRSBs), 2020 (Taxable) will offer 8.05% interest rates from January to June 2025. The interest rate of the RBI Floating Rate Savings Bond is linked to the interest rate of the National Savings Certificate (NSC), a small savings scheme backed by the Union government. The interest rate of RBI Floating Rate Savings Bonds is 0.35% higher than what NSC offers.
According to the RBI press release on January 1, 2025, “The coupon rate on FRSB 2020 (T) for the period January 01, 2025 to June 30, 2025 and payable on July 1, 2025 remains at 8.05% (7.70%+0.35%), unchanged from the previous half-year.”
What is the interest rate of RBI Floating Rate Savings Bond, 2020 (Taxable) for the January to June period of 2025?
The interest rate on the RBI Floating Rate Savings Bond will be 8.05% from January to June 2025.
When will you get the interest of RBI floating rate savings bond?
The interest rate on RBI floating-rate savings bonds is not fixed. It is reset twice every year. When the interest rate on NSC rises, the RBI floating rate savings bond will pay a higher interest rate. Similarly, if the NSC interest rate falls, so will the interest rate on the RBI Floating Rate Savings Bond.
The interest is payable semi-annually. The interest rate on these bonds will be paid on January 1 and July 1 every year. Note that interest is taxable in the hands of the investors. You cannot claim any tax deduction for investing in these bonds. Further, TDS will be deducted on the interest received from these bonds, if the annual interest exceeds Rs 10,000.
RBI floating rate savings bond: What is the minimum and maximum investment?
The minimum subscription amount for the RBI floating rate savings bond is Rs 1,000, with subsequent payments in multiples of Rs 1,000. There is no maximum limit. You cannot borrow against the RBI Floating Rate Savings Bond 2020 (Taxable) bonds.
What is the tenure of the RBI floating rate savings bond?
RBI floating rate bond has a lock-in period of seven years. There is no premature withdrawal option, but senior citizens get the option to prematurely withdraw money with a penalty after a minimum lock-in period. For those aged 60 to 70, the lock-in period will be six years. For those aged 70 to 80, the lock-in period will be five years. Those aged above 80 can withdraw their investment after four years from the date of investment.
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