Shriram Transport Finance Unnati Scheme
This scheme has been rated as FAAA by CRISIL, which is the highest possible rating. The interest rates being offered on a 5-year deposit is as high as 8.25% per annum. On the other hand the 1-year deposit fetches an interest rate of 7.25%, while the interest rate on the 2-year deposit is 7.50% and the 3-year deposit fetches an interest rate of 8%.
We suggest that investors invest in these deposits for the short term. In the more long-term it is likely that interest rates could go higher, given how inflation has been panning out. Investors can opt for the cumulative option or for the regular interest payment option like quarterly or yearly.
PNB Housing Finance
This is another AAA rated deposit, though the interest is lower than Shriram Transport Finance Unnati Scheme.
A 3-year deposit fetches an interest rate of 6.60%, while a 4-year deposit is also 6.60% and a 5-year deposit fetches an interest rate of 6.7%. Senior citizens are entitled to an extra interest rate of 0.25%.
It’s important to remember that company fixed deposits attract a TDS, if the interest income crosses the Rs 5,000 mark. In the case of banks a TDS is applicable if the interest income crosses Rs 10,000. It is therefore advisable to calculate the interest accordingly and place money in multiple deposits.
Bajaj Finance deposits are also AAA rated. The interest rates on a 3, 4 and 5 year deposit is 6.5%. This is almost 1% more than what banks in the country are offering. There is no safety concern here as the deposits are being offered by a company with a strong pedigree.
In the Bajaj Finance deposits one can take a slightly long term view as well while investing in the deposits. Most of the companies now allow deposits to be opened online. The process and procedure to open the deposits are clearly indicated on the website of these companies.
ICICI Home Finance
This is another AAA rated deposit, which offers interest rates in line with most peers. A 3-year deposit gives an interest rate of 6.05%, while a 4-year deposit it is 6.30%, while for a 5-year deposit the same is 6.40%.
Investors who have a TDS that is likely to happen for interest over Rs 5,000 could submit form 15G or 15H, if they are not liable to pay income tax.
It’s important to remember that fixed deposits of companies are not secure and hence there is an element of risk in company deposits. In the past there have been defaults in debt instruments of company deposits.
We suggest that you invest only in the AAA rated deposits with companies that have a strong pedigree.
Investing in fixed deposits is risky as they are unsecure deposits. The author, the brokerage firm or Greynium Information Technologies Pvt Ltd is not responsible for any losses incurred due to a decision based on the above article. Investors should hence exercise caution and do their own research.