Most banks are offering interests in the range of 6% to 7% on their fixed deposits. However some best rated companies and institutions are offering interest rates higher than banks. Below are the details of 7 companies which have high credit rating and offering interest rate more than banks on their fixed deposit schemes.
SBI is offering 6.1% for 1 to 10 years fixed deposits while ICICI Bank is offering 6.00% to 6.40%
Also Read: How SWP in Debt Funds generate higher returns than FD
[dropcap]1.[/dropcap] Bajaj Finance Ltd Fixed Deposit
Bajaj Finance Ltd is a NBFC (non-banking finance company) dealing in all kinds of loans like Personal, Two/Three wheeler loans, car loans etc.
Credit Rating: “FAAA” By CRISIL and “MAAA” By ICRA
Salient Features:
- Additional 0.25% interest for Senior citizens
- Renewal: 0.10% over and above the rate of interest at which the deposit is booked
- Online Investment: Additional 0.10% over and above the rate of interest for using Online mode (not applicable for Senior Citizens)
- Only one benefit of additional 0.10% out of renewal or online investment would be applicable
- Can access FDs online through their customer portal
- Loan: Can take loan up to 75% of the deposit
Interest Rates:
Also Read: How to Fill Form 15G and 15H?
[dropcap]2.[/dropcap] KTDFC Ltd. Fixed Deposit
KTDFC (Kerala Transport Development Finance Corporation Ltd) is NBFC wholly owned by Government of Kerala and deals in Personal and Vehicle Loans among other things.
Credit Rating: KTDFC Fixed Deposits are fully guaranteed by Government of Kerala
Interest Rates:
Also Read: 11 Investments to Generate Regular Monthly Income
[dropcap]3.[/dropcap] Mahindra and Mahindra Financial Services Ltd FD
Mahindra and Mahindra Financial Services is leading NBFC with focus on rural areas and is top tractor financier in India.
Credit Rating: ‘FAAA’ by CRISIL
Salient Features:
- 0.35% additional interest for all Mahindra group company employees and Employees Relatives
- 0.25% additional rate for senior citizens.
- Dhanvruddhi Cumulative Scheme is new scheme which offers higher interest rate (additional 0.25%) and can only be invested through Mahindra and Mahindra Financial Services website
Interest Rates:
[dropcap]4.[/dropcap] PNB Housing Finance Ltd
PNB Housing Finance Limited (PNBHFL) is a public sector housing finance company (HFC) and is promoted by Punjab National Bank. The company provides housing loans & loan against property as a part of its product portfolio.
Credit Rating: “FAAA” by CRISIL and “AAA” by CARE
Salient Features:
- 0.25% additional rate for senior citizens.
- Loan up to 75% of the FD Principal and accrued interest is available
Interest Rates:
[dropcap]5.[/dropcap] Shriram Transport Finance UNNATI FD Scheme
Shriram Transport Finance is NBFC mainly dealing in Commercial Vehicle Finance.
Credit Rating: ‘FAAA’ by CRISIL and “MAA+” by ICRA
Salient Feature:
- 0.25% additional rate for senior citizens.
- Additional interest of 0.15% p.a to employees of Shriram Group Companies and their relatives.
- Additional interest of 0.25% p.a on all Renewals, where the deposit is matured on or after 1st November 2018.
- Fixed deposits are accepted in multiples of Rs.1000/- subject to a minimum amount of ₹5000/- per deposit for cumulative deposits and ₹10000/- per deposit for non- cumulative deposits.
Interest Rate:
Also Read: 5 Important Changes in Tax Rules from April 1, 2019
[dropcap]6.[/dropcap] Shriram City Union Finance Ltd FD Scheme
Shriram City Union Finance is NBFC mainly dealing in retail consumer finance and offers various secured and unsecured loans like home loans, personal loan, business loan.
Credit Rating: ‘FAA+’ by CRISIL and “MAA+” by ICRA
Salient Feature:
- 0.25% additional rate for senior citizens.
- Additional interest of 0.15% p.a to employees of Shriram Group Companies and their relatives.
- Additional interest of 0.25% p.a on all Renewals, where the deposit is matured on or after 1st November 2018.
- Fixed deposits are accepted in multiples of Rs.1000/- subject to a minimum amount of ₹5000/- per deposit for cumulative deposits and ₹10000/- per deposit for non- cumulative deposits.
Interest Rate:
Download: PPF Calculator for Maturity, Loan and Partial Withdrawal
[dropcap]7.[/dropcap] Post Office Time Deposit
Post office Time Deposit (Fixed Deposit) Account can be opened in any post office. The interest rates are reset at the start of every financial year. As of today they are offering higher interest rates than most of the banks. Once you have deposited the money, the interest rate is locked.
Also Read: Impact of RBI Rate Cut on Your Investments and Loans
Credit Rating: backed by Government of India
Salient Feature:
- Fixed deposits are accepted in multiples of Rs.200/- and in multiples thereof
- No maximum deposit limit
Interest Rate:
Helpful Posts on Fixed Deposits
Which bank offers Highest Interest Rate on Bank FD?
13 Most Important things to know before investing in Bank Fixed Deposits
Section 80TTB: Senior Citizens can Save Tax on their Interest Income
TDS threshold on Bank FD increased to Rs 40,000 from April 1, 2019
Avoid TDS: fill Form 15G and 15H
Small Bank FDs offer interest up to 9% – Should you invest?
How SWP in Debt Funds generate higher returns than FD
How to increase bank deposit insurance through Joint accounts?
How Safe is Your Fixed Deposit in Bank?
How you loose Money in Fixed Deposits?
Fixed Deposits that you can use to save Tax
Highest Interest Rate on Recurring Deposits
Understanding Compounding and Yield in Fixed Deposit
How to get Credit card against Fixed Deposit?
7 High Rated Companies Offering more than Bank Fixed Deposits
TDS on Company FDs:
Companies would deduct TDS at the rate of 10% of interest, if the interest earned is more than Rs 5,000 in a financial year.
Tax on Company FDs
The interest received on Company Fixed Deposit is fully taxable. The interest would be added to your annual income and taxed at marginal tax rates.
Also Read: 21 Hidden Charges in Saving Bank Account
Key Points before Investing
Premature Withdrawal is possible on the above company fixed deposits but it requires much more paper work and follow ups. Even the penalty may be more severe as compared to banks
Opening Fixed Deposit is more tiresome as you need to fill forms, visit company branch or get hold of their agents.Also have to give fresh documents for KYC. Bank FDs can be opened online, which is much more convenient.
To Conclude
The above companies are offering have the highest credit rating (which means very low chances of default) and are offering interest rates 1% to 2% higher than the bigger banks. You must look into them for your fixed income portfolio especially if they have easy approachable branches or agents near you.
Have you invested in these companies FDs before? How was your experience? Please share in comments section…
What is advice on live Jeevansathi policy, deferment period 5 years
It is mentioned with most company FDs that incentives are provided if we renew our FDs before maturity. The question is, should this renewal be for same duration as for original FD or we can change it at the time of renewal (Still enjoying incentives). It is crucial point. As if it is for same duration only then it is better to go for small duration & renew it later. The extra incentive will almost cover up difference in interest rate (Not exactly) but then we will have privilege to get money early to meet our need (Not breaking FD). If need is not there then we can renew it to cover up large part of interest loss for smaller duration by renewing it. Please suggest.
Many thanks for compiling this comprehensive and consolidated list!! One does not know where to find this elsewhere.
One question – can’t you trade and sell these corporate FD on the secondary market on NSE after purchasing them, in case you want cash early? Is premature liquidation directly with the company the only way?
Do you also happen to know if selling on secondary market is possible for CG and SG securities and T-bills, once you purchase them from the primary retail market (like IDBI Samriddhi G-Sec portal or equivalent)? If not, does one necessarily have to hold them through maturity?
This is like bank FD and so it cannot be resold. It has to be treated as premature withdrawal and can be done through the respective company itself. What you are talking about is the NCDs that companies offer and they too have higher interest rates.
i am considering to open a FD of 30 L for my Mother in ES AF Small Finance Bank or Utakarsh Small Finance Bank for one year is this will be a safe investment
yes
Is DHFL safe to invest?? Can you tell me it’s advantages and disadvantages if investing the money for long 10 years, take care
Thanks Bro…just concerned about the safety in DHFL deposits…Bajaj Finance can be excellent choice..
i am waiting for when the world will totally decentralized system and digital currency will come out
Sir
I want to deposit amount 1,00,000 as FD for 2 years. Kindly intimate in which bank I will deposited as FD. Kindly suggest me
We publish highest fixed deposit interest across banks in India. You can pick the one which offers highest!
What is the reason people prefer Bank FDs over post-office FDs even though post-office FDs offer higher returns and are more safer option?
Investing in Post Office fixed deposit is cumbersome. You need to queue up in post office and entire process of investment/redemption is still offline and not a pleasant experience. Also when you change residence, you’ii need to transfer your deposits to new post office or come back to original post office to redeem your investment. However in case of bnaks FD can be created/redeemed online. Even in offline mode you can bank from different branches on the bank! All in all banks are easy option!
Dear All,
I am a retired person and a senior citizen. I do not have taxable income then why does the companies deduct TDS on my FD interest. Is there any way to avoid this deduction.
The TDS is deducted as per income tax rules. In case you do not fall in taxable range, you can submit Form 15G/H to avoid TDS. This needs to submitted every year and for all fixed deposits you have.
Useful and informative .
HI Sir,
just i was reading your article i found some error as i am seeing point 2 Bajaj Finance FD rates are mentioned in your articles is different to mentioned bajaj finance website please have a look.
FYI: https://www.bajajfinserv.in/investment/fixed-deposit/fixed-deposit-fees-and-interest-rates.aspx
Thank you for pointing this out. Actually the post is updated every month and if there is a change in interest rate in the month, it might not correctly reflect. Hence its good idea to cross verify on company website.
As you pointed out, I have updated the recent rates. We need more such active readers. Thank you again 🙂
Very nice and valuable information,
Its good to have some money in such funds to protect the risk
Good and valuable information.
Is it really good to take so much of risk for company deposits as we know there are so many defaulters in the market? Also can equity be the substitute for these investment in terms of return?
Equity is totally different asset class. FD is for fixed returns and for limited duration. In equity the returns could be volatile and you might loose 25% in matters of weeks. As for risk is compared investing in top rated “AAA/AA+” companies is safe.
can you please suggest some “AAA/AA” componies?
Its mentioned in the post. Please look carefully
Thank you for this informative post on corporate fixed deposits.