WordsFixed deposit
FD
Short for fixed deposit: money you place with a bank for a fixed period, earning interest, which RBI’s rules call a term deposit. Each bank sets its own penalty for taking it out early, and has to tell you what it is when you open the deposit, or it can’t charge one.
A secured card is issued against one: the bank marks a lien on the FD, so it can’t be closed while the card is open, and sets your limit as a share of it. HDFC Bank, for example, asks for a new FD for its card and removes the lien within four days of the card being closed, once dues are paid, after which the deposit carries on.
Where this comes from
- RBI, Interest Rate on Deposits Directions, 2025Paragraphs 6(20), 22 and 23, as updated 1 October 2026
- HDFC Bank, FD Backed Credit Card FAQs23 February 2026: existing FDs, withdrawals and card closure
- HDFC Bank, Key Fact Statement cum MITC for Credit CardsVersion 4.12, 30 September 2026: Key Fact Statement cum MITC for PIXEL Credit Cards, T) FD backed cards
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