A fixed deposit (FD) in recent times has developed to be a favorable investment option. While other investment avenues are prone to risk, allocating your funds in a fixed deposit can benefit you with higher interest rates and a safe place to invest in. Being a one-time investment, the interest offered on FD is also fixed. Besides this, the lender also offers insurance worth INR 1 lakh to the amount invested. Thus, this assures safety on the funds parked in the FD account.
Talking about a fixed deposit, not only banks but there are also many Non-Banking Financial Companies (NBFCs) that offer this investment avenue. It is a misconception among many that NBFCs are less trustworthy than banks, which is not true. Many NBFCs offer good schemes and a high rate of interest compared to banks’ fixed deposits.
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In recent times, the interest rate offered on fixed deposits has gone down. A major reason for this is the cut down of repo rates by the Reserve Bank of India (RBI). As this is the situation, many investors are posed with a question – whether to invest in fixed deposits or not. When investing in a bank’s fixed deposit, you might gain lesser returns as the interest rates have been dropped down by the RBI, whereas investing in NBFC’s fixed deposit can get benefits for you.
Besides the interest rate, there are various schemes and facilities offered by NBFCs to their fixed deposit investors.
Features offered by NBFC’s fixed deposit:
- High stability and credibility:
Some NBFCs are awarded ICRA’s MAAA, and CRISIL’s FAAA rating, which makes them reliable, is trustworthy. Also, the ratings assure that the investment done is safe.
- Online application process:
When opening your FD account, you can either visit the NBFC in person or carry out the investment process online. You can easily apply for the online process by visiting the website of the lender. This will not only save your time, but the process will also be faster.
- Minimum deposit amount:
It is not always that you might have a huge amount in hand. Since the amount is small, you might think of saving it rather than investing the funds. So, in this case, you can opt for an NBFC’s fixed deposit as they have a minimum deposit amount of INR 25,000.
- Fixed deposit calculators:
You can also calculate your returns before going for an FD investment. With the help of tenor, investment amount, and the interest rate, you can calculate the interest you will be earning on your investments. You can calculate this interest amount withoffered by NBFCs on their websites.
- Fixed deposit tenure:
When investing in a fixed deposit, you are free to choose a tenure ranging from 1 year to 5 years. Also, after your FD is matured, you can reinvest it for the desired tenure period.
Fixed deposit benefits:
- Senior citizen fixed deposit:
Senior citizens can benefit by investing their retirement pension in fixed deposits to gain a higher rate of interest over their investment. The interest rates offered on a senior citizen fixed deposit is high than a normal fixed deposit account.
- Not depending on market conditions:
As fixed deposits don’t depend upon market conditions, they are considered less risky. The interest offered on fixed deposit remains stable and don’t tend to fluctuate according to the market conditions. This makes the fixed deposit the most preferred investment option.
, a trustworthy lender like Bajaj Finserv can provide you additional facilities with higher margins.