MUTUAL FUNDS
It is an investment tool which allows people to make regular deposits and earn decent returns on the investment.
Fixed Deposits
FD is a good option for those who have a lump sum amount to invest. It is also a good option for someone looking for regular cash inflow, as you can choose monthly or quarterly pay-out.
For instance, retired persons can invest benefits received at the time of retirement in a long-term FD. This will ensure the protection of their capital as well as regular interest for their monthly expenses.
Salaried employees can invest their annual bonus in an FD and use it to meet expenses such as buying a car or refurbishing their house, etc.
Attractive Interest Rate starting at 11.00%
Flexibility – use your loan for whatever you choose
Speedy Loan Processing
What should you choose?
If you are looking to build a corpus to meet your financial goals or if you want to set aside a fixed amount for an emergency, a bank deposit is an easy and convenient way to do it. It is one of the safest investment options that are easy to open, operate and withdraw.
Banks offer Fixed Deposits (FD) and Recurring Deposits. But how do you choose between the two? Let us understand the features, benefits and differences between FD and RD in detail.
Difference between FD and RDs
While the interest rate and benefits are the same for FDs and RDs, there are some differences in terms of the manner of investment, minimum investment amount, tenure, etc.
Parameters | Fixed Deposit | Recurring Deposit |
Manner of investment | Invest a lump sum amount for a fixed period | Invest a fixed amount every month for a fixed period |
Tenure | Minimum 7 days and maximum 10 years | Minimum 6 months and maximum 10 years |
Minimum investment amount | Rs 5,000 | Rs 500 |
Interest pay-out | Monthly or quarterly pay-out is available | Monthly or quarterly pay-out is not available |
Auto-renewal option | Is available. You can renew either only principal or both principal plus interest | Not available |
Penalty for delayed instalment | Not applicable | If there is a delay in the instalment beyond the calendar month, you are liable to pay a penalty of 4% over the Benchmark Prime Lending Rate. For RDs opened after August 9, 2016, the penalty is Rs 10 per Rs 1000 per month for the period of delay. Hence, make sure you pay the instalment ton time. |
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