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Fixed deposits are among the most widely used methods of investment in India. They are an easy-to-open, safe investment with decent profits. Those who are risk-averse and searching for a long-term investment have FDs as a well-liked financial approach. Financial gains on this investment are assured. People usually have two kinds of fixed deposits, namely bank fixed deposits and corporate fixed deposits.
A bank fixed deposit is an investment tool offered by banks to both ordinary and professional investors. One must deposit a set amount in a bank for a predetermined amount of time. The investor then earns an established rate of interest on this sum for the fixed tenure.
A corporate FD is a financial tool provided by Non-Banking Financial Companies (NBFCs) or corporations. It functions similarly to a bank fixed deposit, with the requirement that an initial payment be made to the corporation for a predetermined duration of time. These FDs also come with a fixed interest rate.
Explore both bank FDs and corporate bank FDs that cater to the different risk appetites and financial goals of an investor. You’ll be on your own to make the right choice after this read.
Key Takeaways
- Bank FDs
- Axis Bank: Up to 6.45% interest for a three-year term.
- Yes Bank: Offers 7.00% for terms ranging from one to five years, with additional benefits for senior citizens.
- HDFC Bank: Provides 6.40-6.45% interest for three to five-year terms, plus an extra 0.50% for senior citizens.
- Punjab National Bank: Interest rates up to 6.30% for a three-year term, with additional rates for senior citizens and super seniors.
- Corporate Fixed Deposits
- Shriram Finance: Interest rates range from 6.79% to 7.30% for ordinary citizens and up to 8.10% for senior citizens.
- Bajaj Finance Limited: Offers 7.35% to 8.60% interest for all ages, and up to 8.85% for senior citizens.
Best Bank Fixed Deposits
The best bank fixed deposits in India are as follows:
Axis Bank
Axis Bank offers its customers a variety of fixed deposit alternatives to help them secure a specific amount of their funds for a set period of time. For any FD kept for a year, interest is going to be paid at a rate between 3.50% and 6.00%. Axis Bank offers the highest interest rate of 7.10% for a three-year investment period. An additional interest rate may be given to all senior citizens.
Yes Bank
Yes Bank provides attractive interest rates for all of its fixed deposit schemes. The bank offers a 7.25% return on funds invested in FD accounts with terms ranging from one to five years. In addition to the usual FD rates, senior citizens who have fixed deposits valued at less than Rs. 5 crore are eligible for an additional interest rate of 0.50% for a tenure of less than three years and 0.75% for a tenure of three years or more.
HDFC Bank
HDFC Bank provides an extensive number of term options, with an attractive interest rate of 6.60% for a term of one year. The rate of return provided is 7.00% for a tenure of three years. The interest rate on a 5-year investment is 7.00%. Throughout different tenure periods, senior citizens receive an additional 0.50% interest rate.
Punjab National Bank
Punjab National Bank offers the best-fixed deposit rate of 6.40% for a period of one year. The interest rate for a three-year term is 7.00%. The interest rate on a five-year investment is 6.00%. Across all tenures, senior citizens are offered an extra 0.50% interest rate. Super elderly seniors (those who are 80 years of age or older) are qualified for an extra 0.80% interest rate for a number of loan terms.
Best Corporate Fixed Deposits
The best corporate fixed deposits in India are as follows:
Shriram Finance
Shriram Finance provides fixed-rate deposits with annual percentage rates (APRs) of 7.34–8.18% for ordinary citizens and 7.84–8.68% for senior citizens over terms of one year to five years. Additionally, NBFC provides an extra 0.25% annual interest rate on deposits that are renewed after they are matured.
This NBFC has received a creditworthiness rating of AA+/Stable from ICRA and AA+/Stable from India Ratings and Research (Ind-Ra). According to the Ind-Ra, an NBFC’s timely payment of its financial obligations is associated with a significant level of safety (AA+). The ICRA states that an AA rating denotes good credit quality and minimal depositor credit risk.
Bajaj Finance Limited
With terms that range from one to five years, Bajaj Finance Ltd. offers fixed deposit (FD) with interest rates of 7.35-8.60% p.a. to people of all ages and 7.60-8.85% p.a. to senior citizens.
Both CRISIL and ICRA have awarded this NBFC accreditation with an AAA/Stable credit rating. According to CRISIL, AAA denotes a very high likelihood that the HFC will pay regular interest and principal repayments. According to ICRA, AAA denotes the best credit quality and the least amount of credit risk for depositors.
Bottom Line
Fixed deposits are no doubt one of the best forms of investments with very little risk. People of any age or occupation can invest and earn returns within a specific tenure period. Before making any investment, we should consider certain factors to make a wise decision, such as the interest rate, bank or financial institution, financial standing of the corporation, tenure, and more. GoldenPi is an interactive platform that can help new and professional investors choose from a range of fixed-income investment options. You can smoothly choose the tenure, and amount and check the return on your investments through the platform. With various modes of payment, you can start your fixed income investment journey today with GoldenPi.
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FAQs About Fixed Deposit
1. What is the best-fixed deposit to invest in India?
The best-fixed deposit in India depends on individual needs and preferences. For bank FDs, Yes Bank offers attractive interest rates of 7.00%. For corporate FDs, Shriram Finance Limited provides rates as high as 7.60%. Always consider the interest rate, tenure, and financial stability of the institution before investing.
2. Which type of FD is best?
Corporate Fixed Deposit schemes provide greater returns on investment, but selecting the ideal firm is necessary. If you select an effective company FD scheme, you are likely to earn greater returns on your investment than bank FDs because these schemes provide the most favorable interest rates on FDs.
3. How many FDs can a person have?
There is no restriction on how many fixed deposit accounts you may hold. Thus, you may maintain more than one FD at the same bank.
4. What is the difference between FD and RD?
Fixed deposits often have greater interest rates due to the one-off payment structure of the investment. In contrast, recurring deposits have returns based on constant deposits made over a period of time.
5. Which is best, SIP or FD?
One may make investments in an FD if their main objective is to preserve funds and they are not expecting significant returns. If you’re looking to invest in goal-oriented investments that yield higher returns, you should consider investing in a SIP.
6. What should I know before investing in FD?
When making an investment in a fixed deposit, multiple factors should be considered, including interest rates, duration, initial deposit, interest payout, tax effects, safety, and credibility.
7. What is the FD ladder method?
FD laddering refers to spreading your investment over a number of FDs with various interest rates and maturity dates. This creates a “ladder” of maturity dates, providing regular liquidity and the ability to reinvest at better interest rates when the chance occurs.
Disclaimer:
This information is for general information purposes only. GoldenPi makes no guarantee on the accuracy of the data provided here; the information displayed is subject to change and is provided on an as-is basis. Nothing contained herein is intended to or shall be deemed to be investment advice, implied or otherwise. Investments in the securities market are subject to market risks. Read all the offer-related documents carefully before investing.
Bonds or non-convertible debentures (NCDs) are regulated by the Securities and Exchange Board of India and other government authorities. GoldenPi Securities Private Limited is a registered debt broker and acts as a distributor and not as a manufacturer of the product.
