What is Company Fixed Deposit?
Company Fixed Deposit (corporate FD) is similar to a Fixed deposit, but instead of a bank, corporate deposits are held with NBFCs (Non Banking Financial Companies).
important Factors to consider
Credit Rating
Opt for higher-rated corporate FDs based on its credit rating which indicates the underlying risk of the company.
Company Background
Assess a company’s business viability by referring to its Financial Statements, Management Discussion and Analysis (MD & A).
Repayment History
Companies repayment history helps to determine a company's credit score, credibility and stability.
Benefits of Corporate FDs
Higher returns
They provide slightly better returns the traditional bank FDs.
Flexibility
You may choose tenures as per your need (monthly, quarterly, half yearly, annually).
Liquidity
Corporate FDs usually have a lock in period of 3 months after which they can be redeemed at any point.
Lower Risk
Corporate FDs which are backed by reputed rating agencies have a low risk.
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