What Impact Will The Merger Of HDFC-HDFC Bank Have On FD Depositors And Home Loan Borrowers?

 What Impact Will The Merger Of HDFC-HDFC Bank Have On FD Depositors And Home Loan Borrowers?

The merger between HDFC and HDFC Bank will take effect on July 1, 2023. What might you anticipate following the merger? We inform you

As of today, July 1, 2023, HDFC and HDFC Bank are one company. As a result, the more than forty-year-old home finance organization, HDFC, is no more.

As an HDFC Bank customer, you won't experience any changes, but if you've taken out a loan or have any fixed deposits with HDFC, you might notice changes to the application process as well as other things.

You can refer to the frequently asked questions (FAQ) that HDFC Bank has published in this regard if you need more clarification. Some of the key considerations are listed below.

CUSTOMERS WITH FIXED DEPOSITS

There won't be any effects from the merger on people who have fixed deposits (FDs) with HDFC Bank. The interest rate on loans and FDs will stay the same.

FDs With Existing HDFC

Any FD with HDFC will continue to have the same terms and conditions up until it matures or is renewed, including the interest rate, how interest is calculated, the tenure, and payment instructions.

The current HDFC FD receipt will be valid until maturity. Additionally, the account will remain the same and be available for future use with HDFC Bank.

HDFC FD Renewal Following Merger

If a senior citizen's HDFC FD matures after the merger, the FD will be renewed under the current conditions and interest rate offered by HDFC Bank. For various tenures, the bank now offers interest rates ranging from 3.0 percent to a maximum of 7.25 percent. The rate is typically 0.50 percent greater for seniors than it is for the general population.

Seniors who have FDs with HDFC Bank are only eligible for a maximum 7.75 percent interest rate. For terms ranging from five years and one day to ten years, it is the maximum FD rate the bank is willing to provide seniors. In comparison to the rate being provided to the general population, this is 0.75 percent greater.

The final day to take advantage of this interest rate is July 7, 2023.

This long-term investment may be withdrawn early with a penalty. Since this FD is from HDFC Bank, the merger won't have any effect on it.

The Deposit Insurance and Credit Guarantee Corporation (DICGC), which covers both principal and interest, will insure the bank's FDs up to a total of Rs. 5 lakh.

Existing HDFC customers can deposit a new FD by visiting a branch, booking it using the bank's website, or doing so through a deposit agent or relationship manager connected to the deposits.

LOAN APPLICANTS:

The modifications for customers of HDFC and HDFC Bank loans are listed below.

merger's impact on HDFC loan borrower

The loan account number, point of reference, and legal terms will all remain the same, just like with FDs. Additionally, there will be no change in the loan's equivalent monthly instalment (EMI).

Interest rates: Will they alter? 

Instead of the Retail Prime Lending Rate (RPLR), the interest rate will now be based on the External Benchmark Lending Rate (EBLR). From the merger date forward, the interest rate won't change. However, the rate will change in accordance with future revisions in accordance with the EBLR, which is connected to the repo rate.

LAST WORD

Following the merging of the two companies, seniors who have any engagement with HDFC, whether for a loan or an FD, will be HDFC Bank customers starting on July 1, 2023. As a result, they will now be subject to the terms and conditions of deposits and loans as well as the appropriate interest rate.