Corporate Fixed Deposits

Invest in companies for a fixed term for attractive returns

CCorporate Fixed Deposits (CFDs) are fixed deposits offered by corporate, financial institutions and Non-Banking Financial Companies (NBFCs). They offer a prescribed rate of interest over a period of time, usually ranging from 1 to 7 years.

Suitable For


Minimum Investment

FDs

Why Corporate FDs?

Better Interest Rates

Attractive returns at interest rates higher than Bank FDs.

High Liquidity

Minimum lock-in is for just 6 months, post which corporate FDs can be redeemed.

Flexible Payments

Most issuers offer monthly, quarterly, bi-annual and annual interest payments.

 

Steps to choose Corporate FDs

 

Here are four parameters to guide you to choose the right Corporate FD to invest in.

 

Credit Rating

Higher the rating, more secure your investment will be. Hence, always choose Corporate FDs with high ratings.

Company Details

Check the financial health of a company before investing, and know the purpose of the company for raising funds.

Repayment History

Verify if the company has paid regular dividends or defaulted on payment to deposit holders in the past.

Taxation

nterest income from Corporate FDs is taxable. Tax deducted at source (TDS) will be deducted if the interest on a company FD exceeds Rs.5,000 in a financial year.

 

Risks Involved

Unsecured Deposits

Investors run the risk of losing their capital in case the company defaults.

Change in Interest Rates

Principal company, without any prior notice, can revise the interest rates of the fixed deposit.


Reliance Securities is a distributor of Mutual Funds, Portfolio Management Services(PMS), Corporate Fixed Deposits, Bonds/NCDs, Insurance, IPOs, Structured Products and Loans.