Individuals in India enjoy a wealth of investing possibilities, including mutual funds, shares, real
estate, and more. Despite the rising availability of varied investment options, some Indian
families still favour the simplicity and dependability of fixed deposits (FDs).
Most Indians typically put their savings in FDs as a traditional investment vehicle. According to a
SEBI poll, less than 10% of Indian families were interested in investing in mutual funds or
equities, and 95% of Indian families preferred investing in bank FDs because they are not
market-linked assets.
In this blog, we will examine the five main reasons why FDs are a popular investment option
among Indian consumers.
Reasons Why Indian Families Still Invest in FDs
- Guaranteed Returns: The certainty of guaranteed returns is one of the main factors
influencing Indian families’ preference for fixed deposits. In contrast to other investment
choices like mutual funds or stocks, FDs provide a fixed interest rate for a set amount of
time. FDs appeal due to their predictability and assurance, particularly to conservative
investors who choose stability above higher profits. - Capital Safety: For many households, preserving their wealth is a top priority. FDs give
investors a sense of confidence because they are supported by the Reserve Bank of
India’s (RBI) deposit protection guarantee. This guarantees that the principal amount of
the depositors’ deposits, up to INR 5 lakh per bank, is protected even if a financial
institution fails. - Regular Income Stream: The availability of a consistent income stream is another
benefit of investing in fixed deposits. With the variety of possibilities FDs provide,
including monthly, quarterly, or annual interest payouts, people can satisfy their ongoing
financial needs. This monthly cash flow can be beneficial for retirees or people looking
for a steady income source without the volatility associated with other investment
options. - Liquidity: FDs give investors liquidity, which is crucial for many Indian households. Even
though the money is locked in for a set period, some rules allow for early withdrawals or
loans against FDs. Although early withdrawals may result in a decreased interest rate as a penalty, many investors find the ability to access money quickly for an urgent financial
need to be enticing. - Tax Efficiency: Indian families must consider tax efficiency when choosing their
investments. There are certain tax advantages to fixed deposits. For instance, if the
interest on FDs exceeds a certain amount, it is eligible to tax deduction at source (TDS).
If an individual’s income is below the taxable limit, they can still declare their eligibility for
exemption from TDS by submitting Form 15G or 15H.
Why Have an FD Product in Your Investment Advisory
Business
Your financial advisory business needs to meet the varied needs of your clients. While there is
growth potential in mutual funds, stocks, and other investment options, it is essential to
acknowledge that a sizable part of Indian families still favour the security and dependability
provided by fixed deposits. You may give your clients a well-rounded investment portfolio that
considers their risk tolerance and investment preferences by delivering an FD product.
How BInvestt Helps You Offer High-yield FD Products
Blostem is aware of the difficulties experienced by financial technology companies in providing
their clients with investment products. Their capacity to efficiently offer a wide choice of
investment possibilities is frequently hampered by sophisticated processes, time-consuming
procedures, and technical skills. BInvestt steps in to change the environment in this situation.
Their cutting-edge plug-and-play solution is made to enable fintech and distributors of financial
goods to quickly and easily introduce investment products for their clients. With BInvestt, you
can now diversify your products and meet the needs of different investors without being
constrained by established limitations.
BInvestt has you covered whether you want to offer fixed deposits (FD), digital gold, mutual
funds, or other investment products. This comprehensive platform has all the tools and features
required to guarantee a flawless experience from beginning to end.
Blostem provides a seamless experience with BInvestt thanks to its flexible features, which
come in API, SDK, and Whitelabel. Thanks to this comprehensive toolkit, businesses, and
developers may easily include investment management features in their platforms, applications,
or services.
BInvestt offers a flexible and adaptable solution for any business looking to expand its products
with investment features, be it a financial institution, fintech startup, or another type of business.
BInvestt enables businesses to easily provide trustworthy and sophisticated investment
management solutions to their client’s thanks to its user-friendly interface, solid infrastructure,
and comprehensive investment options.
So, get the BInvestt demo for your company right away. To ensure you select the appropriate
plugin for your business needs, try it out for free before integrating it.
