HDFC-HDFC Bank Merger - Top changes for FD and Recurring Depositors

Hi there,

As you may be aware, the merger of HDFC Bank and Housing Development Finance Corporation (HDFC Ltd) became effective from 1 July 2023. This means that all customers of HDFC Ltd are now HDFC Bank’s customers.

There are some changes that you need to know as a customer of HDFC Ltd, especially if you have a fixed deposit account, recurring deposit account, or home loan with the NBFC.

In this newsletter, we will explain the top changes that will affect you after the merger and what you need to do about them.

Changes for fixed deposit (FD) customers

1. Your FD account number remains the same and will be the reference point for all your future communications with HDFC Bank. You don’t need to change anything in your records or documents.

2. The terms of your FD along with interest rates, interest computation methodology, tenure, maturity instructions, and pay-outs remain the same until maturity/renewal of your FD. You don’t need to worry about any change in your returns or cash flows.

3. Your existing deposit receipt issued by HDFC Ltd continues to be valid till the maturity of the FD. You don’t need to get a new receipt from HDFC Bank.

4. Your existing HDFC Ltd FD is now covered by a guarantee from DICGC, within an overall maximum limit of ₹5 lakh (principal and interest) post-merger with HDFC Bank. This means that your FD is more secure and protected than before.

5. If the renewal date of your FD falls beyond the effective date of the merger, renewal of the FD will happen as per HDFC Bank’s terms and the prevailing rates of interest at the time of renewal will apply. You can check the latest rates on their website or visit any branch for more details.

6. You can change the maturity instructions (renewal to repayment or vice versa) on your FD with HDFC Ltd through their customer portal or by visiting any branch of HDFC Ltd or HDFC Bank.

Changes for recurring deposit (RD) customers

1. Your existing RD continues and monthly instalments are debited from the linked account as per the mandate submitted. You don’t need to do anything to continue your RD.

2. The threshold limit for TDS deduction for RD customers of HDFC Ltd has changed from ₹5,000 to ₹40,000 (₹50,000 for senior citizens) after the merger. This means that you may pay less tax on your RD interest income than before.

Changes for common customers

1. If you have term deposits both with HDFC Ltd and HDFC Bank, you will get two TDS certificates for FY 23 as the TDS return will be filed under two TANs (of HDFC Ltd and HDFC Bank). The existing process of dispatching TDS certificates will be used by both entities.

2. From FY 24 onwards, you will get only one TDS certificate from HDFC Bank as the TDS return will be filed under one TAN.

We hope that this newsletter has clarified all your doubts and queries regarding the merger and its impact on your deposits.

If you are looking for higher returns on your deposits, we have some exciting options for you. You can now make a fixed deposit with M&M Finance which offers interest up to 8.3% and Bajaj Finance which offers interest up to 8.6% p.a. These are highly rated NBFCs that offer safety and liquidity along with attractive returns. To know more about these options and how to invest in them, reply to this email.

If you have any further questions or concerns, please feel free to contact us at [email protected].