PPF and other small savings schemes to see rate cut
If reports are to be believed, then small savings schemes like Public Provident Fund (PPF) and post office deposit schemes are going to see a slash in the interest rates. The Indian government will likely announce the new rates for small saving schemes from the month to July and September and in all probability, small saving schemes like PPF are likely to see a cut in the interest rates.
As per reports, interest rates and bond yields are taking a hit because of the accommodative policies adopted by the global central banks. However, due to the sensitivities attached with such schemes, it would likely be more like a balanced cut in rates.
Schemes like Senior Citizens Savings Scheme will continue to provide higher rates of interests. Such schemes have a social objective and won’t be affected by the rate cuts, as per reports. Earlier, ICICI Bank, Axis Bank, and Kotak Mahindra have announced cuts in the deposit rates following Reserve Bank of India (RBI) repo rate cut.
2 July 2019
Why invest in fixed deposits?
Investing in fixed deposits is a lucrative option. This is because it assures an individual guaranteed return irrespective of the market condition. While individuals are prompted to invest in fixed deposits because of the aforementioned reason, there are other reasons as well why one should invest in FDs offered by various banks and Non-Banking Financial Corporations (NBFCs). Let us take a look at them.
- Investing in long-term term deposits enable you to get higher returns.
- Depending on the financial needs, different amounts can be invested in separate investment tenures.
- Investing in FDs help you fund your immediate needs as lenders offer loans against the term deposit.
Several banks in the country offer the option of investing in FDs with attractive returns. Banks like SBI, HDFC, ICICI Bank etc. offer interest up to 7.5% p.a. on different tenures. Some smaller banks and NBFCs offer up to 8% p.a. for investing in term deposits.
6 May 2019
PCoB announces no NPAs for the upcoming decade
Pratap Cooperative Bank (PCoB) has declared zero Non-Performing Assets (NPA) for the next ten years. Based in Maharashtra, this bank offers a range of investment-related and credit-based products. The interest rate for a personal loan lies between 12% p.a. and 18% p.a., cash credit at 13% p.a. and education loan at the rate of 12.50% p.a. Home loans can be availed at 9.75% p.a. for a tenure of 5 years, 10.25% p.a. for a tenure of 10 years and 10.75% p.a. for a tenure range between 15 years and 20 years.
The bank also offers Fixed Deposit (FD) schemes. The FD rates for a tenure between 15 days and 3 months is 5.5.% p.a. 6.50% p.a. is the rate for a tenure from above 3 months to 6 months. The highest interest rate is 7.50% p.a. for an FD with a maturity period within the range of 13 months and 2 years. For a Term Deposit lasting from 25 months to 3 years, the interest rate offered by the bank is 7.00% p.a. One can get an FD interest rate of 7.25% p.a. for availing a Fixed Deposit within a maturity range of above 6 months to 1 year.
9 January 2019
FD rates offered by PNB, SBI, HDFC Bank and ICICI Bank
On 1 January 2019, the Punjab National Bank (PNB) revised its Fixed Deposit rates for select tenures. The rates for an FD with the tenure from above 1 year to 3 years has increased from 6.50% p.a. to 6.75% p.a. The new interest rate for an FD within 6 months to less than 1 year is 6.50% p.a. The Fixed Deposit rate for deposits with a tenure between 46 days to 90 days has rose to 6.55% p.a. from 6.35% p.a.
State Bank of India (SBI) offers an interest rate of 6.70% p.a. for a Term Deposit with a tenure of 1 year. The highest FD rate by SBI is 6.85% p.a. for a maturity between 5 years and 10 years. The range of interest rates is from 5.75% p.a. to 6.85% p.a. On the other hand, HDFC Bank provides 7.30% p.a. on an FD with a maturity of 1 year. This bank offers a maximum interest rate of 7.40% p.a. for a maturity bracket from above 2 years to 3 years.
ICICI Bank provides Fixed Deposit schemes for interest rates between 4.00% p.a. and 7.50% p.a. You can get an interest rate of up to 7.50% p.a. for a tenure from above 2 years to 3 years. The FD rate for a maturity period of 1 year to 389 days is 6.50% p.a.
9 January 2019
Key Features of SBI MODS
State Bank of India (SBI) is one of the leading banks of the country. It offers a multitude of financial products and services to its customers. One of the main products offered by the bank is Fixed Deposits (FDs) or Term Deposits. SBI Multi Option Deposits (MODS) is one the variants of Term Deposits. This scheme comes with high liquidity. The investor can withdraw funds in multiples of Rs.1,000. The remaining amount in the account continues to give them an interest income. An SBI MODS account can be created by visiting the nearest SBI branch or through netbanking.
One needs to make a minimum deposit of Rs.10,000 to maintain an SBI MODS account. One can pick a maturity period between 1 year and 5 years. One can make premature withdrawals from the FD account. The interest income is taxed with Tax Deducted at Source (TDS) as prescribed by Income Tax Act, 1961. The account holder can appoint a nominee for the scheme. They must maintain a minimum balance in their Savings Account linked to the MODS account.
11 December 2018
Suryoday Bank offers FD rates up to 9.00% p.a.
Suryoday Bank is one of the most popular private sector banks. One can avail Suryoday Bank Fixed Deposit (FD) schemes for an interest rate between 4.00% p.a. and 9.00% p.a. A depositor can choose a tenure within the range of 7 days and 10 years. Senior Citizens get an interest rate which is 0.50% higher than the standard rates.
The highest FD rates offered by Suryoday Bank to the general public and senior citizens are 9.00% p.a. and 9.50% p.a. respectively for a tenure of 950 days. The second highest rate for the general public is 8.75% p.a. for a maturity period above 2 years to 3 years. If one invests in an FD for a tenure between 1 year and 2 years, they would get an interest rate of 8.50% p.a. The FD rates for Suryoday Bank are 4.00% p.a. for a tenure between 7 days and 45 days. The interest rate for a tenure above 5 years to 10 years is 7.25% p.a.
11 December 2018
Should People Invest In FDs?
Yes, people should invest in fixed deposit, especially in the current scenario of the market. Since banks and NBFCs have increased the rate of interest on FDs, it is not only safe and risk-free, it also guarantees increased returns.
FDs are one of the best ways to deposit your hard earned money and save it along with earning high rates of interest. Even though liquidity is a drawback when it comes to FDs, it is an indirect way to secure your savings without any scope of unnecessary expenditure.
Senior citizens are entitled to an additional interest of 0.50% per annum which is a safe way of saving money without risking it out in the stock market.
The investors who do not wish to risk their money and would want to expect guaranteed returns, fixed deposit is the answer.
5 December 2018
Fixed Deposit Interest Rates Higher For Nbfcs Than Banks. Which Should You Invest In?
The monetary policy review by the RBI has included an increase of the repo rate by 25 basis points. In the last 3 policy reviews, the repo rate was raised twice which resulted in an increase by 50 basis points which sums up to 0.50% per annum.
Now as the banks have incorporated the review and increased the interest rates on the fixed deposits, Non-Banking Financial Corporations(NFBC) have followed the same to keep up.
Since NBFCs are privately owned, the rate of interest they offer for fixed deposits are comparatively much higher when compared to banks.
For example, in October, Bajaj Finance Limited which is NBFC, increased its fixed deposit from 8.40% per annum to 8.75% per annum. When compared to Bajaj Finance, one of the major banks in the country, State Bank of India offers an interest rate of 6.85% per annum only.
However, even though higher interest rates are offered by NBFCs, it should not be the only criteria which is considered to apply for a FD account.
23 November 2018
Fixed deposit account vs Sukanya Samriddhi account vs Public Provident Fund
Saving money for the future is something each and everyone does. Whether it is in the form of savings account, investing in mutual funds, fixed deposit accounts, provident funds, etc.
However when you have a child, every aspect of your child does require funds. One of the most important aspects which requires planning and saving is education.
The price of education has seen a steep rise since the last 10 years. If you want your child to get educated from a good and reputed school and then college, financial planning, investing and saving is very important.
In the former years, most parents relied on their savings or invested in RDs and FDs to deposit money for their child’s future. However, now there are other investment options to choose from such as a the Public Provident Fund and the Sukanya Samriddhi Account launched by the Government.
20 November 2018
Incremental Credit Surpasses Deposit Growth, Banks Under Pressure To Increase Fixed Deposit Rates
On 12 October 2018, the statement of position of scheduled banks, loans given by the bank were higher by Rs.13,544 crore, compared to deposits which showed a degrowth by Rs.14,567 crore.
Due to this, banks or lenders have been facing pressure to increase the deposit rates in order to grow as per the Reserve Bank of India.
One of the ways which banks would be able to increase the deposits, would be during the time of the festival when credit growth is higher, especially as non-banking financial corporation are facing liquidity issues due to the IL&FS imbroglio. Hence they can offer higher interest rates on fixed deposits in order to encourage people to opt for a fixed deposit.
AU Small Finance Bank, based in Jaipur have increased their interest rates on fixed deposits from 8% per annum to 8.50% per annum for a tenure of more than 18 months to 2 years.
The latest Monetary Policy Report, which was released by the RBI, mentioned that the latest policy rate was given in June 2018. However, banks had been increasing their interest rates on fixed deposits, since December 2017 even before the latest policy rates were given.
The report also observed that the share of current accounts and savings account deposits from the bank fell from 41.1% in March 2018 to 39.6% in the middle of September 2018. The cost taken to fund the banks felt the increased pressure due to this dip.
29 October 2018