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Fixed Deposit

Learn how you can use ZWITCH to help your customers open fixed deposits from your application without visiting the bank.

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A fixed deposit is an investment option offered to customers by financial institutions such as banks and NBFCs. Money deposited is kept by the financial institution for a defined tenure. In exchange, the financial institution pays the customer interest for the tenure of the fixed deposit. This interest can either be paid at maturity or at specified time intervals.

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Prerequisite

To open a fixed deposit using ZWITCH APIs, the applicant should have already created a savings or current account using ZWITCH.

Workflow

Integrating with ZWITCH lets your customers create a fixed deposit in 2 steps.

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Fixed Deposit Workflow

Follow the below steps to open a fixed deposit.

  1. [Prerequisite] Create a Savings or Current Account:
    Currently, fixed deposits can only be created if the applicant has opened a savings or current account using ZWITCH. The fixed deposit has to be linked to a savings or current account.
  2. Create Fixed Deposit:
    Create a fixed deposit by sending us details such as the amount, tenure, and maturity instructions.

Maturity Instructions

When creating a fixed deposit, the account holder must set up maturity instructions. The table below lists the various

ScenarioDescriptionHow to
Auto-renew principal and interestOn maturity, the original principal and the interest earned are reinvested in the fixed deposit and the fixed deposit is renewed for the same tenure.

This happens automatically and does not require any action from you or the account holder.		In the Create Fixed Deposit API:
  • Set the maturity_instruction.auto_renew parameter to interest_and_principal.
  • Do not pass the payout_frequency parameter in the request.
Pay interest monthly and principal at maturityInterest earned is transferred to the savings or current account linked to the fixed deposit every month.

The principle is transferred to the savings or current account linked to the fixed deposit on maturity.

This happens automatically and does not require any action from you or the account holder.		In the Create Fixed Deposit API:
  • Set the maturity_instruction.auto_renew parameter to no.
  • Set the payout_frequency parameter to monthly.
Pay interest quarterly and principal at maturityInterest earned is transferred to the savings or current account linked to the fixed deposit once every 4 months.

The principle is transferred to the savings or current account linked to the fixed deposit on maturity.

This happens automatically and does not require any action from you or the account holder.		In the Create Fixed Deposit API:
  • Set the maturity_instruction.auto_renew parameter to no.
  • Set the payout_frequency parameter to quarterly.
Close fixed deposit prematurelyThe account holder can close the fixed deposit anytime during the tenure of the fixed deposit.

This is a manual action.

When this action is performed, the balance in the fixed deposit account is transferred to the linked savings or current account.		Trigger the Close Fixed Deposit API.

Updated 3 months ago