SBI Annuity Deposit Scheme 2025 – A Safe Investment Option for Guaranteed Monthly Income
When it comes to safe investments in India, most people immediately think of government-backed banks. For individuals who want to convert their savings into a fixed monthly income, the State Bank of India (SBI) has introduced a unique product called the SBI Annuity Deposit Scheme.
This plan is designed for salaried employees, retirees, parents supporting children, and anyone who wishes to receive a steady monthly income while keeping their money safe. With just a one-time deposit, you can enjoy monthly payouts that include both principal and interest.
In this detailed guide, we’ll cover:
- What is the SBI Annuity Deposit Scheme?
- Who should invest in this plan?
- Key features & benefits
- Interest rates in 2025
- Loan & tax benefits
- Example of monthly returns
- Pros and cons
- How to apply online/offline
What is the SBI Annuity Deposit Scheme?
The SBI Annuity Deposit Scheme is a fixed-return investment plan where an investor deposits a lump sum amount for a chosen tenure. In return, SBI pays back the deposit every month in equal installments consisting of:
- Part of the principal amount
- Earned interest
In simple terms, it works like a pension plan or monthly salary plan for individuals who want financial security.
Who Should Consider This Scheme?
This scheme is suitable for:
- Retired persons: Those who want a monthly pension-like income after retirement.
- Parents with children studying away from home: Instead of giving children a lump sum, parents can send fixed monthly amounts.
- Individuals with savings: Those who want safe returns without taking risks in the stock market.
- Joint investors: Couples or family members can invest together for household expenses.
Key Features of SBI Annuity Deposit Scheme
Here are the highlights that make this plan attractive:
- One-time investment: Deposit a lump sum once and enjoy monthly income.
- No age limit: Any Indian citizen with an SBI account can invest.
- Minimum deposit: ₹25,000
- Maximum deposit: No upper limit
- Tenure options: 3, 5, 7, or 10 years
- Monthly payouts: Both principal + interest are included
- Loan facility: Up to 75% of the deposit can be availed as a loan
- Nominee facility: Investor can assign nominees
- Tax benefits: Interest is taxable, but TDS exemptions may apply under Section 80C investments
Interest Rates (2025 Update)
The current interest rates under SBI Annuity Deposit Scheme are:
| Tenure | Regular Citizens | Senior Citizens | SBI Staff |
|---|---|---|---|
| 3 – 5 Years | 5.30% | 5.90% | 6.40% |
| 7 – 10 Years | 5.40% | 5.90% | 6.40% |
👉 Interest is compounded quarterly and paid along with the principal in monthly installments.
Example of Monthly Returns
To understand the scheme better, let’s look at a practical example:
- If you invest ₹1,00,000 for 3 years, you will receive approximately ₹3,259 per month.
- If you invest ₹2,00,000 for the same tenure, the payout will be around ₹6,451 per month.
- For ₹3,00,000, the payout will be close to ₹9,677 per month.
Thus, the higher the deposit, the larger the monthly income.
Benefits of SBI Annuity Deposit Scheme
- 100% safety: Backed by India’s largest public-sector bank.
- Steady cash flow: Ideal for monthly household expenses.
- Flexibility: Tenure options of 3 to 10 years.
- Loan option: Helpful during emergencies.
- Senior citizen benefits: Higher interest rates.
- Ease of application: Available both online (via SBI website) and offline (SBI branches).
Drawbacks of the Scheme
- No liquidity: Once deposited, funds cannot be withdrawn before maturity (except in case of loan).
- Taxable income: Interest earned is taxable as per income tax slabs.
- Returns are moderate: Compared to market-linked investments, returns are lower.
How to Apply?
Offline Process
- Visit your nearest SBI branch.
- Request for the Annuity Deposit Scheme application form.
- Fill in details such as deposit amount, tenure, nominee, etc.
- Submit KYC documents (PAN, Aadhaar, address proof).
- Deposit the chosen amount.
Online Process
- Log in to SBI Net Banking.
- Navigate to Deposit Schemes.
- Select Annuity Deposit Scheme.
- Choose investment amount & tenure.
- Complete payment via net banking.
Who Should Avoid This Scheme?
This scheme may not suit:
- Young investors seeking high returns.
- People who need flexible withdrawals.
- Those in higher tax brackets (since interest is taxable).
Application Form
Conclusion
The SBI Annuity Deposit Scheme is an excellent choice for individuals seeking guaranteed monthly income with zero risk. It works best for retirees, parents, and risk-averse investors. With benefits like steady cash flow, loan facility, and complete safety, this plan ensures financial security and peace of mind.
If you’re looking for a pension-like scheme without market risks, SBI’s Annuity Deposit is worth considering.
