Federal Bank has launched an innovative loan product, Fed Rise. A first-of-its-kind offering in the banking industry, this is an overdraft facility against recurring deposits.
At the time of opening of a recurring deposit, 90 per cent of the maturity value of the RD is sanctioned simultaneously as an overdraft limit. Then at any point, 90 per cent of the balance (inclusive of interest) in the RD can be drawn by the customer. Obviously, as the customer makes payment to the recurring deposit account, the drawing power rises, a bank release stated.
When a purchase is made, or a bill payment or an ATM withdrawal is done, if there is a shortfall of funds in the saving bank account, the system automatically pulls out the deficit amount from the overdraft account subject to the funds position. The withdrawals can be repaid conveniently as preferred by the customer.
A Surendran, general manager and head - retail banking, said as the facility is sanctioned at the time of opening of RD itself, there is no need for the customer to visit the bank for availing the limit in between. The amount can be withdrawn using debit card, PoS, net banking, mobile banking making it a 24/7 digital product. It is available at all the branches of Federal Bank all over India.
