SBI Flexi FD Threshold Limit Enhanced To Rs 50,000; How It Works

The State Bank of India (SBI) increased its auto sweep deposit (FD) threshold limit by Rs 15,000, effective September 1, 2025. Now, such FDs, which are called ‘Multi Option Deposit Scheme (MODS)’, can be opened when the balance in the savings account exceeds Rs 50,000, compared to the previous Rs 35,000. Unlike the typical FD, where the customer instructs the banks to create a term deposit for a certain tenure, MODS or auto deposits are created automatically. Under this, when the balance in the savings account crosses the threshold, the bank creates MODS without seeking separate instructions from the customer each time. Banks promote these FDs as a dynamic tool for customers to maximise interest income from banks and enjoy complete liquidity with no operational hassles. 

What Is SBI’s Auto Sweep Deposit?

According to the bank, it is one of the variants of FDs. One can open FDs with the bank through auto sweep or on a standalone basis.

While the bank mandates a threshold limit of minimum balance in the savings bank account, exceeding which the auto FDs are created, standalone FDs can be created irrespective of the threshold amount.

Latest Changes In The Auto Sweep Deposits’ Threshold Limits

• Minimum threshold changed from Rs 35,000 to Rs 50,000

• Minimum resultant balance changed from Rs 25,000 to Rs 35,000

• Minimum Special Term Deposit Receipt (STDR) amount changed from previous ‘10000 and in multiples of 1000, thereof’, to ‘15,000 and in multiples of 5000, thereof’, now

How Does It Work?

The FDs are created and broken automatically depending on the savings account balance exceeding or falling below the stipulated threshold limit.

This can be opened in a single name or jointly with other account holders, as well as in the name of minors. The MODS so created are for a minimum of one-year period, but are automatically broken to honour a debit mandate when the balance in the savings account is not sufficient to honour the payment.

These FDs are made for a minimum of Rs 15,000 and then in multiples of Rs 5,000. A partial or full withdrawal from these FDs is termed as breaking the FDs prematurely, which attracts a penalty. The amount kept under it earns the interest applicable to FDs, and when broken, the interest applicable to the savings bank account.

The bank offers both First-In, First-Out (FIFO), and Last-In, First-Out (LIFO) options to its customers for breaking auto FDs. The FDs are subject to TDS, which is tax deducted at the source.

Senior citizens are eligible to receive additional interest applicable to them on FDs, but the benefit is not available for super senior citizens. Super Senior citizens (80 years and above) are not eligible for additional interest in auto FDs.