Fixed Deposits is one of the safest forms of investment for risk-averse individuals. The FD’s as it is popularly known amongst the people in India forms one of the traditional, secured, highly liquid, tax saving instrument and forms one of the well-known types of investment choice amongst all the sections of the society. Nowadays, most of the banks and financial institutions have slashed the fixed deposit rate of interest and hence the maturity value on these deposits have come down drastically since a decade.
But, a few banks and financial institutions in the country are still providing the best-fixed deposit rates to lure the customers to park their funds in their accounts. Having a fixed deposit promotes the habit of savings amongst individuals for securing the unforeseen future.
Before understanding in detail about the best-fixed deposits with higher interest rates, let’s know the basic meaning and features of fixed deposit or FD’s.
What is a Fixed Deposit?
A fixed deposit is a form of the financial instrument offered by banks and financial institutions or non-banking financial institutions. This account will be opened for a predetermined period by depositing a sum of money and hence the name fixed deposit account. Here, the deposited amount is fixed and is repayable only on maturity.
As it provides the investors with safety and decent interest rates, higher than the regular savings banks, it is one of the most popular forms of investments. Fixed deposits are also known as term deposits. Investors have an option to withdraw the money before maturity and they will be penalized accordingly for early withdrawal.
Features of Fixed Deposit
- Investors can deposit their money only once and further deposits have to be done with separate fresh accounts.
- Investors can earn a higher return on investment in case of fixed deposits.
- The tenure of the fixed deposits ranges between 7 days to 10 years.
- Fixed deposit interest rates vary based on the tenure of the deposit and also from one bank to another.
- A receipt will be given to the investor known as fixed deposit receipt which they will have to produce at the time of maturity to concerned officials.
- A matured fixed deposit can be renewed for a further period as per the requirements of the investor.
- Loan facility on fixed deposit can be availed.
1. PNB Housing Finance Limited
Registered as a Housing Finance Company, the PNB Housing Finance Limited was incorporated and commenced its operations way back on November 11, 1988. The PNB Housing is promoted by Punjab National Bank. With FAAA or Negative rating on fixed deposits by CRISIL, the PNB Housing Finance Limited is offering the best-fixed deposit currently with an interest rate of 8.15% for 60 – 84 months tenure.
Depositors have to compulsorily lock in for a minimum of 3 months post which there is a provision for premature cancellation of fixed deposits. The interest rates charged will be lower for such FD’s than the initial interest rates agreed at the time of depositing the money.