What happens after an FD matures
Three things can happen, and only one of them keeps paying you the FD rate.
It renews automatically
If the bank has an auto-renewal instruction on record, the deposit rolls over for the same term at the rate on the day it renews. That rate may be well below the one you had. Nobody rings to tell you.
It sits in your savings account
With no instruction, most banks credit the maturity amount to your account, where it earns the savings rate, around 3%. On ₹5 lakh at 7%, that is roughly ₹550 a week you are no longer earning.
It stays put, earning less
Some banks hold an unclaimed maturity as an overdue deposit, paying either the savings rate or the original rate, whichever is lower. The words "whichever is lower" are the important part.
Record this deposit once and the app does the rest: reminded before it matures, told the day TDS starts at that bank, and the rules of the product explained with your own numbers. Free, and your deposits stay on your phone.
Get it on Google PlayQuestions people ask
How do I know which one applies to me?
It is on the receipt, as the maturity instruction. If it says nothing, ring the branch and ask what is on record.
Can I renew after the maturity date?
Usually yes, and many banks will backdate the renewal by up to 14 days. Ask, because it is not automatic.
Is there a deadline?
Deposits untouched for ten years go to the RBI's unclaimed deposits fund. The money is still yours, but getting it back is a process.
Does auto-renewal keep my senior rate?
Yes, if the bank has your date of birth on the account.
Should I always renew?
Not automatically. Compare first: the renewal rate is whatever applies that day, and another bank may be paying more.