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Top 6 Benefits of Opening a Digital Fixed Deposit

July 23, 2025

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Gone are the days when opening a Fixed Deposit (FD) meant long queues, endless paperwork, and frequent bank visits. In today's fast-paced digital world, banking has evolved, making financial investments simpler and more rewarding. Enter Digital Fixed Deposits (Digital FDs)—a smarter, more convenient, and more lucrative way to grow your savings. With higher interest rates, instant online setup, and zero paperwork, Digital FDs offer everything you love about traditional FDs but with added ease and efficiency.

Whether you're a seasoned investor or a first-time saver, Digital FDs provide a seamless and secure way to lock in attractive returns with minimal hassle. Let’s explore why Digital FDs are becoming the go-to investment option and how they differ from traditional FDs.

Key Benefits of Digital Fixed Deposits

1. Higher Interest Rates

Many banks and financial institutions offer higher interest rates on Digital FDs. For example, Ujjivan Small Finance Bank offers interest rates up to 7.6%* p.a. (data as on 17 July 2025) on Digital Fixed Deposit subject to terms and conditions. Senior citizens are eligible for an additional 0.5%* interest rate.

2. 100% Paperless Process

One of the biggest advantages of Digital FDs is the complete elimination of paperwork. Unlike regular FDs that may require in-person verification and multiple forms, Digital FDs can be opened online within minutes using a fully digital process.

3. Hassle-Free Video KYC – Only PAN & Aadhaar Required

With Video KYC (Know Your Customer), opening a Digital FD is now faster and simpler. You only need your PAN card and Aadhaar card for KYC verification, making it a seamless experience without needing to visit a bank branch. Basically, all you need is a smartphone or laptop and a stable internet connection to complete your video KYC.

4. Open a Standalone FD – No Need for a Savings Account

Unlike traditional FDs that often require you to hold a savings account with the same bank, Digital FDs can be opened as standalone accounts. This flexibility allows you to invest in the best FD schemes without being tied to a specific bank.

5. Instant Account Opening and Confirmation

Digital FDs can be set up in just a few clicks. Once the Video KYC is completed, your FD account is instantly created, and you receive immediate confirmation via email or SMS.

6. Flexible Tenure and Auto-Renewal Options

Digital FDs come with customizable tenure options, ranging from 7 to 10 years. Additionally, you can set up auto-renewal to ensure uninterrupted compounding of your investment.

Difference Between Regular FD and Digital FD

Feature	Regular Fixed Deposit	Digital Fixed Deposit
Interest Rates	Higher rates	Higher rates
Application Process	Paper-based, requires physical documents	100% paperless, online application
KYC Process	In-person verification	Video KYC using PAN & Aadhaar
Savings Account Requirement	Often mandatory	Not required
Processing Time	A few days	Instant processing
Auto-Renewal	Needs branch visit or manual request	Online auto-renewal available
Convenience	Limited to banking hours	24x7 availability

Final Thoughts

Digital Fixed Deposits offer a modern, hassle-free way to invest while ensuring higher returns and greater flexibility. With a seamless online process, minimal documentation, and competitive interest rates, Digital FDs are an excellent choice for those looking to grow their savings securely and efficiently.

Looking to grow your savings faster? Ujjivan SFB offers a wide range of fixed deposit products. Select the FD of your choice and take a step forward to your financial goals. Alternatively, you can browse through Ujjivan SFB product suite - our wide range of financial products are designed to make your financial life better.

Disclaimer:

The contents herein are only for informational purposes and generic in nature. The content does not amount to an offer, invitation or solicitation of any kind to buy or sell, and are not intended to create any legal rights or obligations. This information is subject to updation, completion, amendment and verification without notice. The contents herein are also subject to other product-specific terms and conditions, as well as any applicable third-party terms and conditions, for which Ujjivan Small Finance Bank assumes no responsibility or liability.

Nothing contained herein is intended to constitute financial, investment, legal, tax, or any other professional advice or opinion. Please obtain professional advice before making investment or any other decisions. Any investment decisions that may be made by the you shall be at your own sole discretion, independent analysis and evaluation of the risks involved. The use of any information set out in this document is entirely at the user’s own risk. Ujjivan Small Finance Bank Limited makes no representation or warranty, express or implied, as to the accuracy and completeness for any information herein. The Bank disclaims any and all liability for any loss or damage (direct, indirect, consequential, or otherwise) incurred by you due to use of or due to investment, product application decisions made by you on the basis of the contents herein. While the information is prepared in good faith from sources deemed reliable (including public sources), the Bank disclaims any liability with respect to accuracy of information or any error or omission or any loss or damage incurred by anyone in reliance on the contents herein, in any manner whatsoever.

To know more about Ujjivan Small Finance Bank Products Visit:"https://www.ujjivansfb.in"

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to Ujjivan Small Finance Bank Limited or its licensors. Unauthorised use or misuse of any intellectual property, or other content displayed herein is strictly prohibited and the same is not intended for distribution to, or use by, any person in any jurisdiction where such distribution or use would (by reason of that person’s nationality, residence or otherwise) be contrary to law or registration or would subject Ujjivan Small Finance Bank Limited or its affiliates to any licensing or registration requirements.

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FAQs

1. How is a Digital FD different from a regular FD?

A Digital FD is opened online without paperwork, whereas a regular FD requires a branch visit. Additionally, Digital FDs often provide better interest rates and don’t require a savings account.

2. What documents are required to open a Digital FD?

You only need your PAN card and Aadhaar card for Video KYC. No additional documents or physical paperwork are required.

3. Can I open a Digital FD without a savings account?

Yes, many banks allow you to open a standalone Digital FD without needing a savings account with them.

4. How long does it take to open a Digital FD?

With Video KYC, a Digital FD can be opened within minutes. Once the verification is complete, your FD is instantly created.

5. Is my money safe in a Digital FD?

Yes, Digital FDs are offered by banks and NBFCs regulated by the RBI, making them a secure investment option.

6. Can I withdraw my Digital FD prematurely?

Yes, most banks allow premature withdrawal, but it may be subject to a small penalty as per the bank’s terms. Ujjivan doesn’t charge any fee for withdrawals made after 6 months from the time of deposit.

7. What are the tenure options for a Digital FD?

Digital FDs come with flexible tenure options, typically ranging from 7 days to 10 years.

8. How do I renew or close my Digital FD?

You can renew or close your Digital FD through internet banking or mobile banking without visiting a branch.

10. Can I avail a loan against my Digital FD?

Yes, most banks offer loans or overdrafts against Digital FDs, usually up to 90% of the FD amount, depending on bank policies.

Top 6 Benefits of Opening a Digital Fixed Deposit