I saw lien amount in my FD statement. Can someone explain what it is?
I remember the first time I saw the term ‘lien amount’ on my Fixed Deposit (FD) statement, it sounded technical and confusing. But once I understood it, everything about my FD made a lot more sense. I’ll break it down to you in simple terms.
A lien amount in a fixed deposit is the portion of your FD that the bank locks or marks as security. This usually happens when you take a loan against your FD or if there’s any pending obligation in your account.
In short, the bank places a ‘hold’ on that amount. It means you can’t withdraw or break the FD until you clear the lien.
Here’s how it typically works:
- If you take an overdraft or loan against your FD, the bank marks a lien equal to the loan amount.
- If there’s a bank recovery or unpaid dues, the bank might mark a lien until you settle the payment.
- The remaining FD balance continues to earn interest as usual.
Once you repay your loan or clear any dues, the bank removes the lien, and your FD becomes fully accessible again.
It’s always a good idea to check your FD statement regularly. If you notice a lien that you didn’t authorise, reach out to your bank immediately.
In short, a lien amount simply means that part of your FD is being used as security. Your money is still safe and continues to grow, but you’ll need to meet certain conditions before you can freely use it again.