In India, many parents happily use all their life savings to support their children’s education, weddings, and other desires.
But, if parents want, they can put money aside for their children’s future by opening Fixed Deposit (FD) and Recurring Deposit (RD) accounts in their child’s name.
This can help secure a bright future by earning good returns on the investment until the child becomes older.
Let’s learn how to open FD and RD accounts for your child and what documents you may need.
Before opening an account, keep in mind:
1. You can open an FD and RD account for your child without needing their PAN card.
2. It’s a good idea to open these accounts in the same bank where you have your savings account, as some banks have specific conditions for opening a minor’s account.
HDFC Bank, the largest bank in the country, requires you to have a savings account with them to open FD and RD accounts for your children.
3. To open bank accounts for your children, you’ll need to follow Know Your Customer (KYC) rules.
Required documents:
Different banks may ask for different documents to open FD and RD accounts for children. Please check with the specific bank where you want to open your child’s account.
However, some documents are generally accepted by most banks, such as the minor’s Aadhar card, the parent’s Aadhar card, PAN card, and address proof. Some banks may insist on the minor’s Aadhar card for opening FD and RD accounts.
Types of minor accounts:
Banks typically offer two types of accounts for children. The first is for children above 10 years of age who can manage their account and perform transactions.
The second is for children below 10 years of age, where the parents manage the account.
Regardless of the type, both minor and parent(s) must complete the KYC process for these bank accounts.
