Why Fixed Deposits are the safest option in a volatile market

It is rightly said that you shouldn’t work for money but make money work for you. Investments help you in achieving your financial goals by creating additional channels of income. However, investment of capital anywhere and everywhere is not always the right option. With a plethora of investment options available in the market, it can become increasingly difficult to choose an option that is simple, secure, and provides desired returns.

Fixed Deposits (FD) are the safest option for investments, especially in a volatile market. Fixed deposits or term deposits are an investment tool wherein you can put a certain amount of money at a predetermined rate of interest for a fixed period. At the end of the tenure, you receive the principal amount along with interest. FDs are offered both by banks and Non-Banking Financial Companies (NBFCs). Let us dive into what makes fixed deposits the most preferred investment tool for risk-averse investors.

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Fixed deposits

Fixed deposits are the safest investment instrument for people with a low-risk appetite and ambition for capital security. Unlike other investment tools, returns on fixed deposits do not fluctuate with intermittencies of the market. So, even if there is a broader change in interest rates in the market, your FDs will remain unaffected by its turbulences. There is a guaranteed return of the interest and principal sum on the maturity date. Also, booked interest rates of fixed deposits remain the same till maturity. Any change in the banks’ FD rates during the tenure of the deposit does not affect the promised return. This hedge against arbitrarily changing interest rates makes FDs a very attractive option for those looking to build substantial savings over time.

Get maximum benefits with higher and fixed Interest rates


Fixed deposits

Fixed deposits give higher interest rates than saving accounts. Interest rates on fixed deposits vary from bank to bank and tenure to tenure. For example, Airtel Payments Bank, through its partner bank, gives a 6.5% per annum interest rate for fixed deposit tenure of either one, two, or three years. Investors can choose to get interests on a cumulative or non-cumulative basis. Those looking to earn a regular monthly, quarterly, half-yearly or annual income can opt for non-cumulative schemes. Those looking for savings earned over a long period of time can choose cumulative schemes where the accumulated interest is paid on maturity.


Start out small with minimum deposits

Fixed deposits

Fixed deposits do not require ample capital to begin investments. Most financial institutions have different minimum and maximum deposit amounts for fixed deposits. For example, Airtel Payments Bank allows investors to book fixed deposits starting from an amount as small as Rs. 500. This is essentially helpful for people either looking to build a habit of investing or achieving a short-term financial objective.


Have strong and quick backups with the overdraft facility

Fixed deposits

In case of emergencies, customers can obtain loans against the FD. Under an overdraft facility, fixed deposits are used as collateral against the loan. Banks usually allow an overdraft of an amount up to 90% of the FD value. The rate of interest on the OD facility is usually 1 to 2% higher than that on primary FD. The benefit of taking an OD against an FD is that you are charged interest only on the amount utilized from the OD, and the interest is calculated daily. This will help you to meet urgent cash demands without prematurely breaking the FD.


These benefits make fixed deposits a wise and strategic investment choice. Airtel Payments Bank fixed deposit can be opened within minutes from the comfort of your home via the Airtel Thanks App. Why wait? Open yours now!


Disclaimer: This article has been produced on behalf of Airtel Payments Bank by Times Internet’s Spotlight team.
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