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FD auto renewal: Your fixed deposit auto-renewed at a lower interest rate? Can you reverse it? Know here
Mint 26 min ago·11 Nov 2026, 4:51 pm
When a fixed deposit (FD) matures, banks typically offer to reinvest the principal amount at the prevailing interest rate. If you do not provide specific instructions, the bank may automatically renew the FD, often at a rate lower than the original. This can reduce your overall earnings if market rates have fallen since you first invested.
This change matters to investors because it directly impacts the yield on their savings. While the principal remains safe, the interest income is now lower. It is important to review your FD statements carefully to ensure the renewal rate matches your expectations before the maturity date.
To reverse an auto-renewal, you must act before the maturity date. Contact your bank to cancel the renewal and withdraw the funds. If the renewal has already processed, you may need to wait until the FD matures again to close it. Always check the specific terms in your deposit agreement.
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