The 21st century has witnessed the emergence of various financial institutions such as Non-Banking Financial Companies (NBFC), investment banks, internet banks, and brokerage firms, etc. The financial market has grown leaps and bounds with the way it interacts with its depositors and borrowers. The primary thing that all these institutions have in common is that they all provide a Fixed Deposit (FD) scheme. Fixed deposit (FD) is a kind of investment option offered by banking and non-banking institutions which is recognized by its high-interest rate and for its assured returns.

Post Demonetization Scenario

The scenario post-demonetization has seen an increase in Fixed Deposit Interest rates by non-banking financial companies as compared to banks. This transition has been influenced by the need for raising funds by NBFC’s. Non- Banking Financial Companies are financial institutions which have been registered under The Companies Act, 1956. It performs the same functions that a commercial bank performs such as

• Providing loans and advances
• Acquisition of securities.
• Transactions that involve leasing and hire purchase.
• Acts as an insurance provider.
• Provides other marketable and government securities to its account holders.

Non-banking financial companies started offering their Fixed Deposit rate higher as compared to commercial banks due to the arising current market conditions. Non- Banking Companies are offering their Fixed Deposits at interest rates between 8.40%-8.75percent as compared to commercial banks providing an interest rate at 6.85% respectively.

Invest After Risk Ascertainment

Investors in general are tempted to invest in Fixed Deposits after seeing the high-interest rates associated with them. It is recommended that individuals take proper risk ascertainment before investing in any Fixed Deposit provided by non-banking financial companies. The aspects to be analyzed before investing in a Fixed Deposit scheme are as follows-

• Check the credit rating provided by the credit rating agencies to the respective Fixed Deposit scheme. Individuals should look out for credit ratings by ICRA and CRISIL. The rating under such high-interest Fixed Deposit schemes should be AAA/MAAA (stable) for ICRA and FAAA/AAA (stable) for CRISIL.
• It is even recommended to make detailed financial research on the plan in question by checking the financial standing of the company. Financial health should always be analyzed before making decisions regarding investment in Fixed Deposits.
• It is advised to check the tenor of the scheme as there exist certain conditions which may be subject to pre-mature withdrawals such as penalty charges etc.

These are some of the aspects that need to be ascertained before investing in a Fixed Deposit scheme so as to ensure that the individual doesn’t fall prey to any misrepresentation or frauds.

Optimize Your Investments with Bajaj Finance

Bajaj Finance provides Fixed Deposit scheme to individuals as an avenue for safe investments. The features provided under Bajaj Finance are:

• The company is accredited with a credit rating of MAAA under ICRA and FAAA under CRISIL that is a highly stable rating ensuring the credibility of the financial provider.
• A flexible tenor ranging from 12 months - 60 months is offered. There exists a special tenor of 15 month which offers 0.25% more ROI than all the other respective schemes.
• Provides Return on Investment (ROI) at 8.75% - 9.10% which is the highest as compared to other financial providers in India.
• It offers FD Calculator for the purpose of calculating the maturity rate and evaluating returns in advance.
• Fixed Deposit for senior citizens is offered at 0.35% over and above the regular interest rate.
• There is a facility to avail loan against FD permitting to use about 90% of the accrued sum.
• In case of emergencies, the account holder can make premature withdrawals by paying the required penalty charges.
• 24/7 customer care is provided to guide during the application procedure as well as the account management procedure.
• The account holder can purchase, manage, as well as renew the FD online through the website and the Experia portal.
• With every renewal of the FD account, a 0.25% increase in the FD interest rates is provided to the customer increasing the FD returns.
• Bajaj Finance offers quick application procedure with an online application form and minimal document submission.