The Fixed Deposit is an investment scheme that has been trusted by many traditional Indian families. Despite a number of other investment options available, many Indian families still prefer FDs. The biggest reason for this is the predetermined returns. FDs are available with varied tenure options and features that make it a favoured investment option.

Types of Fixed Deposit Schemes and Their Features

Cumulative Fixed Deposit

In a cumulative fixed deposit scheme, the interest earned is reinvested with the principal during the tenure of the deposit. The accumulated interest is paid along with the principal amount at maturity.

This option is generally considered by investors who do not require periodic payouts during the deposit tenure and prefer to receive the maturity amount at the end of the term.

Non-Cumulative Fixed Deposit

In a non-cumulative fixed deposit scheme, the interest earned is paid out at regular intervals such as monthly, quarterly, half-yearly, or annually, depending on the payout option selected.

This type of deposit may be considered by individuals who prefer periodic income from their fixed deposit during the tenure.

Features and benefits that make FD investment preferable

Features

1. Reliable investment option as compared to other investment vehicles

2. You earn interest over a fixed period

3. One can keep FDs for as long as 5 years

4. Special interest rates for senior citizens/women are often available.

Benefits

1. Low risk: It is one of the USPs of the fixed deposit schemes. The returns on FDs are generally not affected by the change in the market conditions.

2. Loan against FD: At times of financial emergencies, one can apply for a loan against the fixed deposit. Financial institutions allow you to use up to a certain percentage of the fixed deposit amount as a loan.

3. Regular source of income: The fixed deposit is a reliable source of income. The interest is credited to the bank account of the fixed deposit holder at frequent intervals, if a non-cumulative scheme is chosen.

4. Fixed Deposits for Senior Citizens: There are sometimes special rates available for senior citizens on FDs.

Shriram Fixed Deposit

Cumulative:

Under this scheme, the interest earned is compounded along with the principal for a fixed tenure. Here, the interest is paid once and not in instalments.

Non-cumulative:

The fixed deposit interest rate is credited to the fixed deposit holder’s account quarterly, monthly, half-yearly or annually, as chosen by the depositor. This option is designed to offer convenience to those looking for income at regular intervals, like retirees.

The FD calculator lets you calculate the interest earned at the end of tenure to help the investor in making the right sound financial decisions.

Apply for Shriram Unnati Fixed Deposit now. It offers an interest rate of up to 8.15%* p.a. which is inclusive of the additional interest rate of 0.50%* p.a. for senior citizens and 0.05%* p.a. for women depositors.

Grow your savings with Shriram Finance. Book an FD today.