Corporate fixed deposits (CFDs) are fixed-income instruments issued by companies to raise capital from the public. CFDs offer higher interest rates than traditional bank FDs, making them an attractive investment option for Indian depositors seeking higher returns.
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However, investing in CFDs carries a higher degree of risk. The creditworthiness of the issuing company must be thoroughly evaluated before investing in their corporate FDs, as there is a risk of default on interest or principal payments.
Unlike bank deposits, CFDs are not insured by the DICGC, so no deposit insurance claims can be made in case of a default. Investors should also consider the liquidity of the CFD before investing, as early withdrawals may result in penalties. Corporate FDs typically have a fixed tenor ranging from a few months to several years.
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Credit ratings may help depositors understand which CFDs are considered the safest. AAA-rated and AA-rated CFDs are issued by some of the most well-know financial institutions which are often part of large business conglomerates. These companies have an excellent track record in managing depositor money.
Overall, corporate FDs can provide higher returns than traditional bank deposits, but investors must carefully evaluate the creditworthiness of the issuing company and consider the risks involved before investing.
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| Company | Credit Rating | Highest Rate | Tenor For Highest Rate | Senior Citizen Premium | Senior Citizen Rate |
| Bajaj Finance | AAA Company | 8.35 | 44 months | 0.25 | 8.60 |
| Shriram City Union Finance | AA Company | 8.18 | 50-60 months | 0.50 | 8.68 |
| Sundaram Home Finance | AAA Company | 7.90 | 48-60 months | 0.35 | 8.25 |
| Sundaram Finance | AAA Company | 7.75 | 24-36 months | 0.50 | 8.25 |
| Mahindra Finance | AAA Company | 7.75 | 42 months | 0.25 | 8.00 |
| LIC Housing Finance | AAA Company | 7.75 | 36-60 months | 0.25 | 8.00 |
| HDFC Ltd | AAA Company | 7.75 | 45 months; 75 months for senior citizens | – | 8.00 |
| ICICI Home Finance | AAA Company | 7.60 | 45 months | 0.25 | 7.85 |
| PNB Housing Finance | AA Company | 7.70 | 36-47 months | 0.25 | 7.95 |
Compiled by BankBazaar.com. BankBazaar takes no guarantee for the accuracy of this information. Investors are advised to invest their money after assessing banking risks. Interest rates as advertised by the bank/company on May 22, 2023. Rates pertain to retail deposits. Rates will change as per the bank or company’s policies. Special FD schemes are for limited periods. Highest rates for each bank or company are mentioned here. For companies, the highest cumulative rate is mentioned. Some rates are as per special schemes which for limited periods. In some cases, higher rates may be available to super senior citizens, employees, bulk depositors, or non-callable depositors. Please contact your bank or preferred company for details of deposit schemes. BankBazaar.com is India’s largest fintech co-brand credit card issuer.
