Fixed Deposit

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Fixed Deposit

FDs are one of the oldest and most common methods of investing. When it comes to assured returns, choosing the right type of savings scheme makes all the difference.
Fixed Deposits let you make the most of value-added benefits as you create wealth at low risk.
Fixed Deposits in companies that earn a fixed rate of return over a period of time are called Company Fixed Deposits.

  1. Financial Institutions
  2. Non-Banking Finance Companies (NBFCs).
  3. Manufacturing Companies
  4. Housing Finance Companies
  5. Government Companies

Company Fixed Deposits offer comparatively higher returns than banks. Choose the best tenure for you from a wide range as per your convenience. You can choose how frequently you want to receive your interest payments:
  1. Maturity
  2. Yearly
  3. Half-yearly
  4. Quarterly
  5. Monthly
Company Fixed Deposits are non transferable that means there is no fear of FD receipt being stolen. In case it falls into wrong hands, it cannot be misused.
Premature encashment of deposit is available any time subject to payment of prescribed penalty. Diversify Risk- The deposits should be spread over a large number of companies engaged in different industries. This way, you'll be able to diversify your risk among various industries/companies.
Wide Choices- Many companies operating in the Company Deposit market. This will help you decide whether to renew or reshuffle the deposit.
Attractive rates as applicable from time to time.

Monthly Income Scheme (MIS)
  • Safe & sure way to get a regular monthly income
  • Specially suited for retired employees/ Senior Citizens or any one with high sum for investment
  • Rate of interest 8.4%
  • Maturity Period - Five Years
  • No Bonus on Maturity w.e.f. 01.12.2011
  • Auto credit facility to SB Account.

Type of Account Minimum limit Maximum limit
Single INR 1500/- INR 4.5 lakhs
Joint INR 1500/- INR 9 lakhs

Recurring Deposit
  • Any individual (a single adult or two adults jointly) can open an account
  • Advance Deposits earn rebate
  • Four defaults are allowed
  • Rate of interest 8.40%
  • Defaults can be paid within two months
  • Part withdrawal facility available
  • Premature closure allowed after three years
  • Pay Roll Savings Scheme is also available for employees of various Establishments

Type of Account Minimum Deposit Maximum Deposit
Individual Account INR. 10/- and in multiples of INR. 5/- thereafter No limit.
Time Deposit
  • Any individual (a single adult or two adults jointly) can open an account
  • Group Accounts, Institutional Accounts and Misc. account not permissible
  • Trust, Regimental Fund or Welfare Fund not permissible to invest
  • 1 Year, 2 Year, 3 Year and 5 Year TD can be opened
  • In case of premature closure of 1 year, 2 Year, 3 Year or 5 Year account on or after 01.12.2011, if the deposit is withdrawn after 6 months but before the expiry of one year from the date of deposit, simple interest at the rate applicable to from time to time to post office savings account shall be payable
  • In case of premature closure of 2 year, 3 year or 5 year account on or after 01.12.2011, if the deposit is withdrawn after the expiry of one year from the date of deposit, interest on such deposits shall be calculated at the rate, which shall be one per cent less than the rate specified for a period of deposit of 1 year, 2 year or 3 years as mentioned in the concerned table given under Rule 7 of Post office Time Deposit Rules
  • Rate of interest - 8.40%,8.40%,8.40%,8.50% compounded quarterly for 1,2,3 &5 years TD account respectively w.e.f 01.01.2014
  • The investment in the case of A 5 years TD qualify for the benefit of Section 80C of the Income Tax Act, 1961 from 1.4.2007
Type of Account Minimum Deposit Maximum Deposit
1,2,3 & 5 Year TD INR.200/- and in multiples of INR. 200/- thereafter No limit.
Senior Citizens Savings Scheme (SCSS)
  • A new avenue of investment and return for Senior Citizen
  • The account may be opened by an individual,
    1. Who has attained age of 60 years or above on the date of opening of the account
    2. Who has attained the age 55 years or more but less than 60 years and has retired under a Voluntary Retirement Scheme or a Special Voluntary Retirement Scheme on the date of opening of the account within three months from the date of retirement
    3. No age limit for the retired personnel of Defence services provided they fulfill other specified conditions
  • The account may be opened in individual capacity or jointly with spouse
  • Non-resident Indians (NRIs) and Hindu Undivided Family (HUF)are not eligible to open an account
  • The individual may open one or more account in the multiple of INR.1000/-,subject to a maximum limit of INR.15 lakh
  • No withdrawal shall be permitted before the expiry of a period of five years from the date of opening of the account. The depositor may extend the account for a further period of 3 years
  • Premature closure of account is permitted,
    1. After one year but before 2 years on deduction of 1.5 % of the deposit
    2. After 2 years but before date of maturity on deduction of 1% of the deposit
  • Premature closure allowed after three years
  • In case of death of the depositor before maturity, the account shall be closed and deposit refunded without any deduction along with interest
  • Interest @ 9.20% per annum from the date of deposit on quarterly basis. Interest can be automatically credited to savings account provided both the accounts stand in the same post office
  • Interest rounded off to the nearest multiple of rupee one
  • Post Maturity Interest at the rate applicable to the deposits under Post Office Savings Accounts from time to time is admissible for the period beyond maturity
  • Nomination facility is available in the Scheme
  • The investment under this scheme qualify for the benefit of Section 80C of the Income Tax Act, 1961 from 1.4.2007.
15 Years Public Provident Fund
  • Ideal investment option for both salaried as well as self employed classes
  • Non-Resident Indians (NRIs) not eligible
  • Investment up to INR. 1,50,000 per annum qualifies for IT Rebate under section 80 C of IT Act
  • The rate of interest on the subscriptions made to the fund on or after 01.12.2011 and balances at credit of the subscriber in the existing PPF account shall bear interest at the rate of 8.70% per annum.
  • Loan facility available from 3rd financial year upto 5th financial year. The rate of interest charged on loan taken by the subscriber of a PPF account on or after 01.12.2011 shall be 2% p.a. However, the rate of interest of 1% p.a. shall continue to be charged on the loans already taken or taken up to 30.11.2011
  • Withdrawal permitted from 6th financial year
  • Free from court attachment
  • An individual cannot invest on behalf of HUF (Hindu Undivided Family) or Association of persons
Type of Account Minimum limit Maximum limit
Public Provident Fund (Individual account on his behalf or on behalf of minor of whom he is the guardian) INR. 500/- in a financial year INR. 1,50,000/- in a financial year
National Savings Certificate
NSC VIII Issue
  • Scheme specially designed for Government employees, Businessmen and other salaried classes who are Income Tax assesses
  • No maximum limit for investment
  • No tax deduction at source
  • Certificates can be kept as collateral security to get loan from banks
  • Investment up to INR 1,00,000/- per annum qualifies for Income Tax Rebate under section 80C of IT Act
  • Trust and HUF cannot invest
  • Rate of interest 8.50%

NSC IX Issue
  • No maximum limit for investment.
  • INR. 100/- grows to INR 234.35 after 10 years
  • Minimum INR. 100/- No maximum limit available in denominations of INR. 100/-, 500/-, 1000/-, 5000/- & INR. 10,000/-
  • A single holder type certificate can be purchased by an adult for himself or on behalf of a minor or to a minor
  • IRate of interest 8.80%
  • Maturity value of a certificate of INR.100/- purchased on or after 1.4.2012 shall be INR. 236.60 after 10 years

New pension Scheme has the following broad objectives:
  1. Provide old age income
  2. Reasonable market based returns over the long term
  3. Extending old age security coverage to all citizens

Permanent Retirement Account Number (PRAN). It will always be permanent.
  1. PRAN will provide access to two personal accounts
  2. Tier-I pension account: You will contribute your savings for retirement into this non withdrawal account.
  3. Tier-II savings account: This is an ad-on account, which is simply a voluntary savings facility. You are free to withdraw your savings from this account whenever you wish.

Entry age 18-60 Year
  1. Minimum amount per contribution - Rs 500
  2. Minimum contribution per year - Rs 6,000
  3. Minimum number of contributions - One per year
  4. Active choice - Individual Funds {Equity (E), Corporate bonds (C) and Government Securities (G) Asset classes
  5. Auto choice - Lifecycle Fund

NPS also allows you to choose from any one of the following six entities to manage your pension fund
  1. ICICI Prudential Pension Funds Management Company Limited
  2. IDFC Pension Fund Management Company Limited
  3. Kotak Mahindra Pension Fund Limited
  4. Reliance Capital Pension Fund Limited
  5. SBI Pension Funds Private Limited
  6. UTI Retirement Solutions Limited

In this option, the investments will be made in a life-cycle fund. Here, the percentage of funds invested across three asset classes will be determined by a pre-defined portfolio. At the lowest age of entry (18 years), the auto choice will entail investment of 50% of pension wealth in "E" Class, 30% in "C" Class and 20% in "G" Class. These ratios of investment will remain fixed for all contributions until the participant reaches the age of 36. From age 36 onwards, the weight in "E" and "C" asset class will decrease annually and the weight in "G" class will increase annually till it reaches 10% in "E", 10% in "C" and 80% in "G" class at age 55.

  • No additional CRA charges for account opening and annual maintenance in respect of Tier II. A nominal charge will be taken separately for each transaction in Tier II.
  • Unlimited number of withdrawals, only criteria to maintain a minimum balance of Rs 2000 at the end of Financial Year i.e., as on March 31st.
  • Contributing to Tier II account
You have to make a minimum contribution of Rs. 250 and have to make minimum one contribution in a Financial Year. You can contribute to Tier II account till you have active Tier I account.
Vesting Criteria Benefit
At any point in time before 60 years of Age You would be required to invest at least 80% of the pension wealth to purchase a life annuity from any IRDA - regulated life insurance company. Rest 20% of the pension wealth may be withdrawn as lump sum.
On attaining the Age of 60 years and up to 70 years of age At exit you would be required to invest minimum 40 percent of your accumulated savings (pension wealth) to purchase a life annuity from any IRDA-regulated life insurance company.
You may choose to purchase an annuity for an amount greater than 40 percent. The remaining pension wealth can either be withdrawn in a lump sum on attaining the age of 60 or in a phased manner, between age 60 and 70, at the option of the subscriber.
Death due to any cause In such an unfortunate event, option will be available to the nominee to receive 100% of the NPS pension wealth in lump sum. However, if the nominee wishes to continue with the NPS, he/she shall have to subscribe to NPS individually after following due KYC procedure.

This allows the investor to reap the benefits of compounding till he turns 60. The NPS also offers the flexibility to draw up to 60% of the retirement corpus as a lump sum to meet financial life goals like children's marriages, housing, or draw down the lump sum in a staggered manner till one is 70 years old. The rest can be used to buy an annuity from any of the seven Irda-regulated annuity service providers. So, the NPS is probably the only wholesome, universal, technology driven retirement planning product in the country today.