Do the Digit Insurance

Pay as you Drive

Car
Two Wheeler
9000+ Hospitals

Health
Commercial
Covering Seniors

Travel
Home

What are the Different Types of Fixed Deposits (FDs) in India?

types of fixed deposits

Fixed Deposits are one of the most popular investment options to save and grow money gradually. It is the safest option available, which offers guaranteed returns and can be opened very easily.

In this piece, you will understand the different types of fixed deposit schemes available in India, along with those available for NRIs.

Team Digit

What are the Different Types of FDs in India?

Fixed Deposits are broadly classified into the following different categories:

Regular Income FD: Regular Income fixed deposits suit best for people who have limited income, and their regular expenses depend on interest from the deposited money. The depositor can either withdraw monthly or quarterly.
Tax Saving FD: This fixed deposit account allows a customer to avoid taxes while earning interest up to ₹1,50,000 per year. However, it has a 5-year lock-in period during which one cannot withdraw the deposited money. Although no tax is deducted from the deposited money, the interest that is compounded is taxable.
Flexi Fixed FD: By the name, it is understandable that this fixed deposit is flexible and convenient for the use of customers. Flexi Fixed Deposit offers high-interest rates like a fixed deposit and liquidity like that of a savings account. So, we can call it a mixture of a savings account and a fixed deposit.
Cumulative FD: In this type of fixed deposit, the interest is compounded quarterly on the principal amount of money at the rate that the financial institution decides. The main advantage of this scheme is that the depositor earns interest on the main amount along with the interest component.
Non-Cumulative FD: In non-cumulative fixed deposits, the earned interest is withdrawn at regular intervals rather than being accumulated. This works as a steady source of income.
Standard Fixed FD: This is the most common type of fixed deposit where the money is kept for a fixed tenure at a rate that is decided by the bank. The tenure can range from a week to several years. The interest rates are generally much higher than a normal savings account.
Senior Citizen FD: In these types of fixed deposits, the rate of interest is quite high. Also, the customer can decide the frequency of payouts, like quarterly, annual, or monthly.

What are the Different Types of FDs for NRIs?

The banks also have specific schemes for the NRIs. There are two types of accounts that can be held by the NRIs, and they are:

NRE FD: NRE fixed deposits allow the NRI to deposit money into his or her account from a foreign country, which is consequently converted into Indian currency. In simple words, it is just a term deposit account that is kept to transfer foreign income.
NRO FD: NRO fixed deposits are held by those NRIs that have a steady income coming from India, such as rent, fees, or any other kind of business. The amount in this account is completely taxable, and the interest rates vary depending on the bank.

How to Choose the Right Fixed Deposit?

The simple answer is you should choose an FD that aligns with your plans and financial goals. Being an investor or depositor, it is very obvious for you to look for better interest rates. The interest rates depend on the amount of money and the time period for which the money is kept in a fixed deposit.

Nowadays, there are various investment options, but the scheme of fixed deposit remains the safest option. Fixed deposits guarantee returns on whatever you invest. There are different types of FD available for both resident and non-resident Indians.

FAQs about Types of Fixed Deposits

All

Which bank offers 7% interest on fixed deposits?

YES Bank offers 7% interest on fixed deposits.

What is the maximum rate of fixed deposit?

The maximum rate offered for a fixed deposit is 8.6% for people above 60 and 8.35% for people below 60.

Is a fixed deposit better than an investment?

Investment incurs a lot of risks. However, going for a fixed deposit makes it the safest option as the principal money is received at the end of the tenure along with the interest.

Other Important Articles about Banking

Post Office Savings Accounts

What is BSBD Account

What is a Term Deposit

Deposits in Transit in Bank Reconciliation

What is a Demand Deposit Account

Fixed Deposit Vs Savings Account

What is a Remote Deposit Capture (RDC)

Is Savings Account Interest Taxable

How to Open a Savings Account

Multiple Savings Accounts

What is Bank Deposit

How to Open a Savings Account Online

How Does Interest Work on a Savings Accounts

Meaning of Cash Deposits

Health Savings Accounts (HSA)

Women’s Savings Account

What is a Senior Citizen Saving Scheme Account

Types of Savings Accounts in India

Types of Fixed Deposits

Benefits of Savings Account

Deposits which Earns High Interest Rates

Types of Bank Deposits

What Is a Joint Bank Account

Advantages and Disadvantages of Savings Account

What Is a Call Deposit Account

What Is a Recurring Deposit

Savings Account Vs Current Account

Benefits of a Savings Accounts

How to Choose the Best Savings Account

Family Savings Bank Account

Farmers Bank Savings Account

What is Current Deposit Account

What is a Certificate of Deposit

Salary Account Vs Savings Account

What is a Savings Accounts

Zero Balance Savings Account

Important Articles related to Finance

What is Employee Provident Fund (EPF)?

Identity Theft and Fraud Guides

Salary Structure Guides

Importance of Financial Planning

QR Code Guides

Financial Planning for Women

Kisan Vikas Patra Scheme Guides

Financial Planning for Salaried Employees

Banking Guides

What is Credit Score?

UPI Guides

NPS Scheme Details

What is Annuity?

Professional Tax in India

Atal Pension Yojana (APY) Scheme

What is Public Provident Fund?

Sukanya Samriddhi Yojana (SSY) Scheme

What are Credit Cards?

Check Pending Challan only on Digit App

Install

Check Pending Challan only on Digit App

Latest News

Currently there are no news to show.

Read More

Renew & Download Policy Document, Check Challan, Credit Score, PUC & more

60K+ Reviews

4.8

Rated App

60K+ Reviews

12K+ Reviews

4.3

Rated App

12K+ Reviews

Download the App

CIN: L66010PN2016PLC167410, IRDAI Reg. No. 158.

Go Digit General Insurance Limited | Corporate Office Address: Atlantis, 95, 4th B Cross Road, Koramangala Industrial Layout, 5th Block, Bengaluru 560095 | Registered Office Address: 1 to 6 floors, Ananta One (AR One), Pride Hotel Lane, Narveer Tanaji Wadi, Shivaji Nagar, Pune-411005, Maharashtra | Trade logo of Go Digit General Insurance Ltd. displayed above belongs to Go Digit lnfoworks Services Private Limited and is provided and used by Go Digit General Insurance Ltd. under license.