FEATURES OF RBI FLOATING RATE SAVINGS BOND
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100% Risk-Free Investment
Interest payable half-yearly in Jan & Jul each year
Interest rate set at 8.05% till Dec 2023
Minimum Investment - Rs. 1000 (and in multiples thereof) Maximum Investment - No Limit
Floating Rate of Interest. Is subject to change in Jan & Jul each year
Maturity is 7 years from Investment date. Premature withdrawal for Senior Citizens
Interest Rate is linked to National Savings Certificate (NSC)
Not Tradable & not Transferable
Bond will always pay 0.35% higher than NSC rate
Nomination Facility Available
Who Can Invest ?
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An Individual, not being a Non-Resident Indian
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A Hindu Undivided Family
Note: Investments via Netbanking are only available for Singly Held Savings Accounts. For Joint accounts a physical application will be required.
You can apply for the Floating Rate Savings Bonds 2020 (Taxable) if you are:
A person residing in India
• In his or her individual capacity, or
• In individual capacity on joint basis, or
• In individual capacity on anyone or survivor basis, or
• On behalf of a minor as father/mother/legal guardian
A Hindu Undivided Family
FAQs
Are the Floating Rate Savings Bonds (Taxable) transferable?
No, these bonds are not transferable.
What is the minimum and maximum limit for investment in the Floating Rate Savings Bonds (Taxable)?
The Bonds will be issued for a minimum amount of Rs. 1000/- (face value) and in multiples thereof. There will be no maximum limit for investment in Bonds.
What is the tenure of the Floating Rate Savings Bonds (Taxable)?
The tenure of the bond is 7 years from the date of issue. No interest will accrue after the maturity of the bond.
Is a nomination facility available?
Yes, a nomination facility is available.
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How much tax do I have to pay?
The interest income from the bonds is taxable. TDS (This stands for Tax Deducted at Source, which means the tax you have to pay on your salary is already deducted and the net amount is received by you.) is deducted at the time of interest payment as per the prevailing IT rules.
What is the minimum and maximum limit for investment in the Floating Rate Savings Bonds (Taxable)?
The Bonds will be issued for a minimum amount of Rs. 1000/- (face value) and in multiples thereof.
What is the tenure of the Floating Rate Savings Bonds (Taxable)?
The tenure of the bond is 7 years from the date of issue. No interest will accrue after the maturity of the bond. Premature redemption facility is allowed for investors in the age group of 60 years and above as per RBI’s Notification.
When is the interest payable?
Interest is payable semi-annually from the date of issue of bonds, up to 30th June / 31st December as the case may be, and thereafter half-yearly for period ending 30th June and 31st December on 1st July and 1st January respectively.
Are the Floating Rate Savings Bonds (Taxable) transferable?
No, these bonds are not transferable.
How much interest will the Floating Rate Savings Bonds (Taxable) bear?
The interest rate of the bond, would be re-set half yearly starting with Jan 1st, 2021 and thereafter every July 1st and will be linked with the prevailing National Saving Certificate (NSC) rate with a spread of (+) 35 bps over the respective NSC rate.
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Can the bonds be offered as collateral for loans ?
No these bonds cannot be offered to banks and financial institutions as collateral for loans.
SPECIFIC CONDITIONS ON PREMATURE WITHDRAWAL FOR SENIOR CITIZENS
Minimum lock-in period from the date of issue as per Investor age bracket :
Age Bracket. Lock-in Period
60 to 70 years. 6 years
70 to 80 years. 5 years
Above 80 years 4 years