Fixed deposits are a great way to save your hard earned money and also have it increased while you sit back and relax. Almost everyone with a regular income applies for a fixed deposit with their regular bank, but do you know which ones will give you the highest amount of yield? Not all fixed deposits run the same way or in accordance with the same principles. Variables such as the Fixed Deposit interest rate heavily affect the yield generated from the fixed deposit and, thus, one needs to carefully search the market before choosing a fixed deposit lender.
Factors to consider while choosing an FD lender
Interest Rate
The FD interest rate that the provider offers is one of the primary factors that will influence your choice. It can be within 3.5% to 8% for a bank and 8% to 11% for finance companies. Thus, a general check through all the banks and other FD service providers will ensure that you have an idea of the market standards.
Minimum deposit amount
The minimum deposit amount varies from one finance company to another. While most of them have smaller amounts, to begin with, not all of them provide such a choice. Therefore, it is important to consider the minimum deposit amount against the interest rate and then make a decision.
Credibility
With the number of financial services and small banks popping up everywhere, it is absolutely important that you open your fixed deposit account with a bank or service provider that is totally credible and has a history of honest transactions. Before deciding to invest in any company deposit, check the credit rating of the company. Company FDs with a credit rating of AAA or AA exhibit the minimum required the strength of performance. Company FDs with ratings below these indicate poor performance and high risk.
Top FD services of 2019
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Bajaj Finance
For this season, it is Bajaj Finance that takes the crown for the best FD account to save your money with. With an interest rate of 8.75% and even higher for senior citizens, Bajaj Finance FD accounts start as low as INR 25,000. You also have the benefit of a highly flexible tenor to choose from and a custom 15-month tenor as well that offers 0.25% more interest than the interest for a 12-month FD. Bajaj Finance fixed deposits (FD) have been rated high on stability and safety by CRISIL (FAAA/Stable rating) and ICRA (MAAA/Stable rating). The FD calculator available on the Bajaj Finserv website is a highly useful tool and should be readily used to decide which Bajaj Finance FD scheme is best suited for you. Add to all of this, the entire process of managing your FD account can be availed online.
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Mahindra Finance
Mahindra is also a great company to partner with while opening an FD account. They currently provide 8% interest rate, which is lower than Bajaj but is still a good percentage. You also have the option of using some of their longer tenor plans to increase your wield, but for shorter tenors, the yield is not too high. Mahindra Finance provides two different schemes (Dhanvruddhi and Samruddhi) which you can opt for while opening an FD and these can be customized to fit both cumulative and non-cumulative models.
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PNB Housing Finance
The only bank to make it to the top three this year is Punjab National Bank. While they offer only 6.75% on their FD interest rates, for customers that are willing to open a long-term account with them, they can avail higher interest rates on their FD accounts. Opening a fixed deposit account at PNB is also profitable because of its flexible tenure options. Although a newcomer to the banking market, PNB caught up quickly with their clever and user-friendly policies. One such policy is that anyone holding a large FD at PNB can have a loan issued against it.
Also, Read This: How to Calculate Fixed Deposit Maturity Amount?
Choosing the right FD partner is much tougher than it sounds. Although there are quite a few FD calculators online that you can use to find out how much your exact yield will be, there are a lot of options out there, and you might not always be able to scrutinize them at a micro level. Bajaj Finance FD is a trustworthy option if you don’t want to delve too much into research before choosing an FD partner. Additionally, they have a variety of choices so you can ensure that you can get the best out of your fixed deposit account.