Banks are usually the first choice for fixed deposits, but term deposits can also be made in post offices and corporate bodies. Many people believe that corporate organizations are unsafe, but financial experts suggest depositing in AAA-rated institutions is safer. It is important to note that the insurance facility of up to Rs. 5 lakh under the Depository Insurance Credit Guarantee Scheme (DICGC) is not available for company deposits.
Regarding interest rates, big banks like the State Bank of India offer lower interest rates, resulting in lower returns. On the other hand, leading corporates and small finance banks offer attractive interest rates, especially for senior citizens who receive extra interest.
For example:
- Mahindra Finance Company offers 7.60% interest to general customers and 7.85% interest to senior citizens.
- Bajaj Finance Limited offers 7.65% interest to senior citizens.
- Sundaram Home Finance offers 7.95% interest to seniors.
- LIC Housing Finance Limited provides 7.50% interest on deposits with a maturity of one year for senior citizens.
- ICICI Home Finance Company offers 7.50% interest for one-year tenure fixed deposits and 7.90% interest for two-year deposits for senior citizens.
