New Delhi : Corona virus has killed all over the world. On the one hand, the process of new cases of infection is not coming to an end every day, on the other hand the condition of strong and strong economies has also deteriorated. To save the Indian economy, the Reserve Bank of India (RBI) is continuously reducing interest rates. Profits from traditional investment options such as Fixed Deposits (FD) have been steadily decreasing. Investment options for senior citizens are limited.
The floating rate savings bonds of RBI can prove to be a safe investment option for those who want regular income, in the midst of a bad environment in the midst of the Corona crisis. The central bank has introduced floating rate savings bonds after closing the bonds with a fixed interest rate of 7.75%. There will be a guaranteed return of 7.15% on the investment. Anyone can invest in it. People of Indian origin abroad or NRIs cannot invest in floating rate savings bonds.
Any Indian citizen can also invest in bonds in the name of minor as guardian. You can also apply for bonds jointly. In this bond of RBI, Indian citizens can start investing at least Rs 1,000. There is no maximum investment limit. The lock-in period of investment in this bond is 7 years, that is, you cannot withdraw money during this period.
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Interest is paid half yearly on this bond of RBI. Its first payment will be on 1 January 2021. Interest rates are fixed every six months. The first change in interest rates will be done on 1 January 2021. On January 1, 2021, you will get 7.15% interest on the investment made now. There is no option for Cumulative Interest at the time of maturity for floating rate savings bonds, like RBI’s 7.75% Fixed Interest Rate Bonds.
Talking about the benefit of income tax exemption in floating rate savings bonds, you will not get any benefit. Income from these bonds will be fully taxable. The investor is required to pay the full tax on the proceeds from the interest of these bonds.
TDS will also be deducted on interest income. You can apply for these bonds through any government bank or big private banks like ICICI Bank, HDFC Bank and Axis Bank. You can apply for these bonds both online or offline. Up to Rs 20,000 cash can be invested in these bonds. While applying for RBI bonds, you have to provide your bank account details so that the interest can be directly transferred to your account.
