NBFC FD Interest Rate

Non-Banking Financial Companies (NBFCs) Fixed deposit is a low-risk investment option used for depositing a certain amount for a fixed period over a predetermined interest rate. There are different investment options for

Investors choose from NBFC FDs based on the interest rates offered, tenure options, features and flexibility.

The FD rates by NBFCs are diverse and they also offer flexible tenures, offering investors high returns on their investments. NBFC FDs are also accessible to a wide range of individuals. Let’s go through the highlights of NBFC fixed deposits from below:

Table of Content

• ⇾ NBFC FD Interest Rates
• ⇾ NBFC FD Calculator
• ⇾ Types of NBFC Fixed Deposits
• ⇾ NBFC FD Eligibility Criteria
• ⇾ Documents Required for NBFC FD
• ⇾ Features and Benefits of NBFC FD
• ⇾ Factors Affecting NBFC FD Rates
• ⇾ Frequently Asked Questions

NBFC FD Interest Rates

Fixed Deposits offered by Non-Banking Financial Companies (NBFCs) are popular investment options because of their competitive interest rates and flexibility. Investors often seek out FDs from top NBFCs due to their reputation for reliability and attractive interest rates. Here are some of the top NBFC fixed deposit rates:

NBFC FD Calculator

An online FD calculator is an online tool that helps you estimate your returns on maturity upon entering deposit amount, interest rate, and tenure to calculate the estimated maturity amount, giving you clarity on your financial decisions and FD investment options.

Another way to calculate the FD maturity amount is by using the formula:

A=P x (1+r/n)^nt

Where:
A = Maturity amount
P = Principal amount
r = Annual interest rate
n = Number of times interest is compounded per year
t = Tenure of the FD in years

Here is an example of the calculation:

Types NBFC Fixed Deposits

Fixed Deposits from NBFCs are of two different types, these are cumulative FDs and non-cumulative FDs:

• Cumulative FD
• Non-cumulative FD

Here is an in depth insight for the 2 types of FDs.

• Cumulative fixed deposits: Cumulative Fixed Deposits are a specific type of fixed deposit in which the accrued interest is compounded and paid together with the principal amount at the end of the deposit term. The reinvested interest will lead to increased returns upon maturity. This deposit option is perfect for individuals who favour receiving a consolidated sum at the end of the investment duration instead of periodic interest payouts.
• Non-cumulative fixed deposits: Non-Cumulative Fixed Deposits are savings plans that give you regular interest payments at intervals of the investor’s choosing, such as monthly, quarterly, half yearly, or annually. Unlike cumulative deposits, the interest earned is not reinvested into the principal amount, but allows investors to withdraw it periodically as income.

NBFC FD Eligibility Criteria

The eligibility criteria for NBFC fixed deposits includes a diverse range of entities, these are:

• Resident Indian citizens
• Minors (through their parents or guardians)
• NRIs (Non-resident Indians)
• Family Trust
• Charitable Trust
• HUF (Hindu Undivided Family)
• Clubs
• Companies
• Trusts and Foundation
• Sole Proprietorship
• Partnership Firms
• Association Societies
• Unincorporated Association or Body of Individuals.

Documents Required for NBFC FD

There are several documents required to apply for an NBFC fixed deposit, these are:

• Resident Indian Citizens
• Passport
• Driving licence
• Permanent Account Number (PAN) card
• Voter identity card issued by the Election Commission of India
• Job card issued under the National Rural Employment Guarantee Act (NREGA), duly signed by a State Government officer
• Letter from the Unique Identification Authority of India containing details of name, address, and Aadhaar number, or any other document specified by the Central Government in consultation with the regulator.
• NRIs (Non-Resident Indians)
• Passport with valid visa/OCI
• Overseas employment letter (optional, for confirmation of residential status and overseas address)
• PIO cards
• PAN card
• Local proof of address, if different from the passport address
• Bank account statement or passbook
• Local property papers with registration deed
• EB Bill card
• Voter ID or driving licence
• Tax Residency Certificate from the Income Tax department of the country of residence
• Copy of the passport at the beginning and end of the financial year.
• Hindu Undivided Families (HUF)
• Non-Individual FD Application Form
• PAN Card and Address proof of Karta
• PAN Card of HUF
• HUF Deed / Declaration from the Karta
• KYC form of Karta
• Trust and Foundations
• For investments exceeding Rs 1 crore, a declaration of the income source is required.
• Provide names, addresses, and contact details of trustees, settlers, beneficiaries, and signatories.
• Only deposits from registered trusts are accepted.
• Our investment does not qualify under Sec 11(5) of the Income Tax Act.
• Association of Persons
• Non-Individual FD Application Form
• Certificate of Registration
• PAN Card and address proof of the entity and the authorised signatories
• Board Resolution of the managing body to invest in FD along with a list of authorised signatories
• MOA and AOA of the Association
• KYC Form of authorised signatories
• Tax Exemption Certificate if applicable
• Certified copy of Share Holding Pattern on the Letter Head of the Company
• KYC of beneficiary owners holding more than 15% of property, capital, or profits of the association, along with recent photographs.
• Partnership Firms
• PAN card
• Address proof (bank statement, telephone bill, utility bill)
• Partnership deed copy
• Copy of resolution
• ID and address proof of all authorised signatories
• Photographs of signatories
• Cancelled cheque leaf for bank account verification
• Companies
• PAN card
• Address proof (bank statement or telephone bill)
• Certificate of incorporation
• Memorandum of articles & association with the latest board resolution and specimen signatures
• List of authorised signatories
• Photographs of signatories
• Cancelled cheque leaf for bank account verification
• ID and address proof of authorised signatories
• Nagar Pallka
• Corporate FD Application Form
• PAN Card and address proof of the entity and the authorised signatories
• Certificate of Incorporation
• Bye-Law or Formation Document
• Board Resolution of the managing body to invest in FD along with a list of authorised signatories
• KYC Form of authorised signatories
• Tax Exemption Certificate if applicable
• Co-operative Societies
• Non-Individual FD Application Form
• PAN Card and address proof of the Society and the authorised signatories
• Society Deed/Bye-Laws
• Certificate of Registration
• Board Resolution of the managing body to invest in FD along with a list of authorised signatories
• KYC Form of the authorised signatories
• Tax Exemption Certificate if applicable
• Certified copy of Shareholding Pattern on the Letterhead of the Company
• KYC of beneficiaries owning more than 15% of property or capital or profits of the association, along with a recent photograph
• Sole Proprietorships
• ID and address proof of the proprietor
• Address proof
• PAN card of the proprietor
• Telephone bill
• If the sole proprietorship is under a different name, provide the bank statement or registration certificate
• Cancelled cheque leaf for bank account verification
• Photograph
• Cooperative Bank
• Corporate FD Application Form
• PAN Card and address proof of the Bank and the authorised signatories
• Certificate of Registration or licence issued from RBI
• Bye-Law/MOA/AOA
• Board Resolution of the managing body to invest in FD along with a list of authorised signatories
• KYC Form of authorised signatories
• Tax Exemption Certificate if applicable

Features & Benefits of FD with NBFCs

NBFC fixed deposits offer unique features and benefits that make them attractive to investors, these are:

1. Guaranteed Returns: Investors receive guaranteed returns at fixed interest rates, making sure that the maturity value exceeds the initial investment.
2. Competitive Interest Rates: Enjoy competitive interest rates of up to 9.91% p.a., with additional benefits for senior citizens and women investors.
3. Diverse FD Schemes: Choose from a variety of FD schemes that are personalised to suit different financial goals, with flexible investment amounts and tenures.
4. Paperless Process: Open an FD account seamlessly online with minimal documentation required, providing convenience and ease of access.
5. Minimal Investment: Start your investment journey with a minimal deposit amount of ₹1000, making FDs accessible to all investors.
6. Loan Facility: Avail a loan against your FD in case of financial emergencies, with interest rates lower than normal personal loans.
7. Regular Interest Payouts: Choose between cumulative and non-cumulative FDs, with options for regular interest payouts of monthly, quarterly, half-yearly or annually.
8. High Credit Rating: Investors can benefit from the safety and security of FD investments backed by high credit ratings, ensuring reliability and stability.
9. Tax Benefits: Enjoy tax benefits with no TDS on interests of up to ₹5000 in a year, providing additional savings on your investment returns.

Factors Affecting NBFC FD Interest Rates

There are many factors that can influence NBFC FD rates. Understanding them is important for making informed investment decisions. The factors affecting NBFC FD interest rates are:

1. Economic Conditions: The economic environment of the country, including inflation rates, interest rates set by the central bank, and overall market conditions, can impact NBFC FD rates.
2. NBFC Policies: Each NBFC will have its own set of policies and strategies regarding interest rates. These can vary based on their business objectives, target market, and funding requirements.
3. Competition: Competition among NBFCs and other financial institutions can also affect FD rates. Higher competition may lead to more attractive rates while less competition will lead to higher interest rates.
4. Credit Rating: The credit rating of an NBFC can play an important role in determining FD rates. Higher-rated NBFCs may offer better rates to attract investors due to their lower risk.
5. Government Policies: Government policies and regulations, particularly related to monetary policy and taxation, can impact interest rates offered by NBFCs.