The merger of the country's largest private sector bank, HDFC Bank, and mortgage lender, Housing Development Finance Corporation (HDFC), is effective July 1. Notably, the twin entities first announced the decision to merge on April 4, 2022, after getting approvals from the board, shareholders, and regulators.
"The merger of HDFC with HDFC Bank will offer cross-selling opportunities to the bank, while the home loan business will be complemented by the bank’s core strengths," said Chairman Deepak Parekh in a letter to the shareholders of HDFC on June 30. In simple words, this means that post-merger, home-loan customers of HDFC will benefit from the synergies of the new entity.
The bank's deposits will stand at Rs 18.84 lakh crore after the merger with HDFC.
Now, post-merger depositors of both entities would have various queries. We try to answer these queries here.
I have a fixed deposit (FD) booked with HDFC Ltd. What are the changes in terms after the merger?
There will be no change in the terms of your FD with HDFC. The interest rates, methodology to compute interest, tenure, maturity, and pay-outs will remain the same until the maturity/renewal of your FD. Your existing deposit receipt issued by HDFC will continue to be valid until the maturity of the FD.
Your FD account number will continue, and it will remain the reference point for all your future communications with HDFC Bank.
Also read: HDFC-HDFC Bank Merger | How key business metrics of HDFC Bank will change
I am an existing customer of HDFC Bank, and I have an FD with HDFC Ltd. Now, will my deposit with HDFC be visible in my current HDFC Bank net banking or mobile banking?
No, you cannot access deposits with HDFC from your HDFC Bank net banking and mobile banking services. Your HDFC deposit booked before June 30, 2023, will be visible in HDFC’s customer portal only. New deposits booked through the customer portal after June 30, 2023, will be visible in both the HDFC customer portal and HDFC Bank’s net banking or mobile banking.
Also read: HDFC-HDFC Bank Merger | All you need to know about its impact on home loan customers
I have an FD with HDFC. After the merger, do I need to open a bank account with HDFC Bank to access my deposits with HDFC? Also, will interest income from my HDFC FD continue to get credited into my savings account in another bank (i.e., a non-HDFC bank)?
No, you do not need to open a bank account with HDFC Bank post-merger to access your HDFC deposits. Also, your interest income from HDFC FD will continue to get credited to another bank’s savings account (as you have linked). There will be no change in the process of crediting interest income from the HDFC FD.
How will the renewal of FDs take place post-merger?
If the renewal date falls beyond the effective date of the merger, i.e., July 1, 2023, renewal of FDs will take place as per the bank’s terms, and prevailing rates of interest at the time of renewal will apply. For instance, if your HDFC FD’s maturity date is July 25, 2023, and you are planning to renew it, then HDFC Bank’s prevailing rate of interest will be applicable.
Individual and non-individual depositors can change the maturity instructions (from renewal to repayment and vice versa) on FDs with HDFC through the customer portal or by visiting existing HDFC deposit offices of HDFC or any other HDFC Bank branches.
Also read | Deepak Parekh in last letter to HDFC shareholders: 'It is time to hang my boots'
What will be the process for premature withdrawal of a deposit with HDFC after this merger?
The premature withdrawal of the deposit will be as per the premature withdrawal terms and conditions of an HDFC deposit. You can do it through HDFC’s branches, agents, or customer portal.
I had submitted Form 15 G/H to HDFC before the effective merger announcement. Is it still valid?
Form 15 G/H submitted by depositors of HDFC for FDs placed before the effective merger will be valid.
However, for any fresh FD post-merger, the depositor would need to submit an additional Form G/H.
Existing depositors of HDFC can continue to use the current process and platform for submitting Form 15 G/H for FDs booked post-merger.
How would the tax deducted at source (TDS) return be filed if I have deposits with HDFC and HDFC Bank? From where would I get the TDS certificate for the current financial year?
If you have deposits with both entities, the TDS return will be filed under two tax deductions and collection account numbers (TANs), i.e., HDFC and HDFC Bank, in the initial year of the merger. There will be two TDS certificates for common customers of HDFC and HDFC Bank. The existing process of despatch of TDS certificates will be used by HDFC and HDFC Bank, respectively.
Also read: TDS, TCS aren’t money lost forever, you can adjust or claim it back
I have an HDFC branch office in my vicinity and used to visit it for servicing of my deposits. Will that branch now continue to service my deposits?
Yes, you will continue to be serviced by your existing deposit office as it was before the merger. Moreover, you can now reach out to any branch of HDFC Bank for servicing of the HDFC deposit.
Will my FD with HDFC now be covered by a guarantee from the Deposit Insurance and Credit Guarantee Corporation (DICGC)?
Yes, post-merger with HDFC, the existing HDFC FD will be covered by a guarantee from DICGC, within an overall maximum limit of Rs 5 lakh (principal and interest).
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