The interest rates of bank fixed deposit plans depend on various factors such as repo rate, internal liquidity, economic situation, etc. The FD interest rates do tend to change with tenor, type of deposit, and customer category as well. Due to the current economic situation, the FD rates have been reduced across all the bank fixed deposits. However, you can still grow your corpus at a decent rate by investing in FDs offered by NBFCs.
Due to the high interest rates offered by Bajaj Finance FD, investing money in fixed deposits can still be a profitable prospect for you. The reasons for the same are highlighted below:
Opportunity to Earn Higher Interest
As the FD interest rate offered by this FD scheme can be up to 6.75%, you have the opportunity to earn higher interest. You can invest your money in a cumulative FD for a longer tenor to multiply your interest growth faster.
This is possible as cumulative FDs do not offer interest payout options. Therefore, the interest that is calculated periodically gets included in the principal amount and this entire sum is considered for interest calculation during the next interest calculation period. As a result, the interest compounds quickly and you get higher returns.
Bank FDs offer interest rates up to 5.5% and that also only for longer tenors. On the contrary, Bajaj Finance FD maintains a high rate of interest through the tenor range. If you invest Rs. 10,00,000 in bank FD for 3 years, you will only receive an interest rate of up to 5% but for the same amount and same tenor, Bajaj Finance FD offers FD interest rates of up to 6.75%. The returns that you will get after 3 years can be checked from the below table:
|FD plan||FD type||Amount||Tenor||Interest Rate||Interest earnings||Returns|
|Bank FD||Cumulative FD||Rs. 10,00,000||3 years||5%||Rs. 1,60,755||Rs. 11,60,755|
|Bajaj Finance FD||Cumulative FD||Rs. 10,00,000||3 years||6.75%||Rs. 2,16,476||Rs. 12,16,476|
For calculating returns with other combinations of tenor, amount, and FD type, you can utilize the FD calculator that is provided on the portals of Bajaj Finance and respective banks.
Ensuring the stability of the investment before investing money is a smart move because it will help you to avoid investing in instruments that might be prone to market risks. Bajaj Finance FD is regarded as a stable instrument and has a track record of zero unclaimed deposits to date. The high credit ratings that this FD scheme has secured from leading credit rating organizations like ICRA and CRISIL establishes the fact that your invested capital is safe.
Bajaj Finance FD is considered to be one of the best FD schemes in the market because it is up to you to decide the period for which you want to lock in your corpus. You get a flexible tenor ranging from 12 to 60 months for making this choice.
Also, if you want to explore the benefits offered by different combinations of tenor and amount, you can prefer investing through its multi-deposit feature. This option lets you divide your corpus into smaller amounts and invest them in different FD plans. Moreover, you can also set a different lock-in period and fixed deposit type for each of these deposits.
By investing in several fixed deposit plans, you can utilize your corpus for satiating your interim fund needs. You may even consolidate the returns of some deposits and reinvest them in a cumulative FD for growing your earnings at a swift pace.
Uncomplicated Investment Process
The investment process provided by Bajaj Finance is uncomplicated as you can submit your application form online and there is no need to submit the documents if you have registered them under CKYC norms. You can share your CKYC number and complete the verification procedure online and the corpus can be deposited through net banking. UPI, or some other digital modes of your choice.
On investing money online in Bajaj Finance FD, your deposit will multiply at a 0.10% higher interest rate. Senior citizens have the opportunity to grow their investments by a 0.25% higher FD rate as well. All these benefits make Bajaj Finance one of the most reliable and best FD schemes across the FD market segment.
Banks and finance companies will charge a penalty if you break an FD or withdraw a partial amount before maturity. This penalty can result in a deduction of 1 or 2% in your interest earnings.
Therefore, before investing in an FD that you are interested in, you must check its penalty charges as well. Alternatively, you can seek a loan against FD, such as in the case of Bajaj Finance FD. The loan amount can be up to 75% of your fixed deposit value. The loan is processed quickly as minimum documents are required for loan approval. This means there is no need to break or withdraw a partial amount even if there is a financial emergency.
Fixed deposits are popular because they are safe and offer better interest rates than a savings account. Cumulative FDs are ideal for wealth creation whereas non-cumulative FDs help you to generate a fixed income to meet your regular expenses. It is necessary to look out for better paying FDs in both cases. Bank FDs are not as high as they were a year ago as banks had to lower their rates due to economic crisis and repo rate reduction. However, you can still multiply your savings at a fast pace by investing in corporate FDs such as Bajaj Finance FD that are offering interest rates up to 7.35%.