Paisabazaar Goes Beyond Credit: Now Offers FDs & Bonds with Returns Up to 13.25%

Paisabazaar, India’s leading marketplace for consumer credit and a free credit score platform, today announced its foray into wealth management with the launch of fixed income instruments on its platform. The strategic initiative is a part of Paisabazaar’s long-term objective of building a diverse and holistic financial wellness platform. The Paisabazaar would now facilitate comparing and choosing Fixed Deposits and Corporate Bonds.

This move comes on the back of Paisabazaar launching PB Money – a personal finance management platform built on the Account Aggregator framework, along with other data integrations designed to provide consumers with holistic insights and advise, to help them build stronger financial health.

Now with the launch of fixed income instruments, Paisabazaar offers retail investors a seamless digital experience while accessing a wide suite of secure and high-return fixed income offerings, all from a single platform.

Santosh Agarwal, CEO of Paisabazaar 

“At Paisabazaar, our vision is to build a platform that caters to the diverse financial needs of our consumers through a wide product suite. With the launch of fixed income instruments, we are offering our consumers a comprehensive range of investment options, through simple and transparent digital processes. Our objective is to be a lifelong financial partner for our consumers by helping meet all their borrowing, saving and financial wellbeing needs," Santosh Agarwal, CEO, Paisabazaar, said.

Consumers on the Paisabazaar App can check, compare and book from a range of Fixed Deposits (FDs), which includes Bajaj Finance, Suryoday Bank, Shivalik SF Bank, Slice SF Bank, Utkarsh SF Bank, Shriram Finance, and South Indian Bank. The entire investment journey on Paisabazaar is fully digital and seamless.

Corporate Bonds offer potential returns of up to 13.25%, and interest payouts on a monthly or quarterly basis. The minimum investment amount starts at just ₹1,000, making this an accessible option for a wide set of retail consumers. Corporate Bonds on Paisabazaar are powered by Grip Invest, a SEBI-regulated platform.

Consumers through the Paisabazaar platform can choose bonds based on parameters like Yield, Credit Rating, and Investment Amount. For investors seeking diversification and higher returns, Paisabazaar also offers personalized advice, curated and vetted by SEBI-registered analysts, enabling consumers to invest in a basket of securities aligned to specific investment themes.

Paisabazaar says, as part of its long-term strategy, it would continue to scale unsecured lending and build a robust secured lending portfolio, while parallelly expanding into savings and investment solutions and deepening its collections and risk management capabilities.

“This approach strengthens customer lifetime value, deepens engagement, and creates a resilient and diversified business model. A key focus is addressing the needs of ‘New-to-Credit’ (NTC) and underserved segments, many of whom remain outside formal credit systems. Leveraging technology, data analytics, and deep consumer understanding, we are responsibly bringing millions into the financial mainstream,” Santosh Agarwal added.

Paisabazaar, a part of PB Fintech (listed since 2021), is India’s largest marketplace for consumer credit and free credit score. Over the last 11 years, Paisabazaar has earned the trust of over 50 million consumers and it handles 20 lakh+ monthly enquiries from 1000+ cities. Paisabazaar has built 65+ partnerships withBanks, NBFCs, and fintechs to offer a broad range of credit products. Paisabazaar is ISO (27001:2013) and PCI DSS certified organisation, with industry-best controls, to safeguard the best interest of consumers.

Are Fixed Deposits better than Debt Mutual Funds?

Many times, investors struggle to choose between Fixed Deposits (FDs) and debt mutual funds. Both are debt-based products, but their returns and risk levels differ. While FDs provide guaranteed returns, debt mutual funds offer market-linked growth.
Understanding their differences is essential for making the right financial decision. Let us explore which option better suits your needs.

What Are Fixed Deposits?

Fixed Deposits are time-bound investments that banks and financial institutions offer. You invest a lump sum for a specific tenure and earn a fixed interest rate. The returns remain unaffected by market fluctuations. You may use a Fixed Deposit calculator to know about the returns before investing.

Key Features of Fixed Deposits:

• Guaranteed returns with fixed interest rates.
• Tenure flexibility ranges from a few months to several years.
• Premature withdrawal is allowed (penalty may be charged).
• You can avail yourself of loans against your FD, up to 90% of the deposit amount.

What Are Debt Mutual Funds?

Debt mutual funds, also known as Income or Bond Funds invest in fixed-income instruments like money market instruments, treasury bills, government bonds, etc. These funds give you returns based on interest rates and market conditions.

Key Features of Debt Mutual Funds:

• Debt funds deliver returns that track market movements and shift with interest rate changes.
• Expert fund managers diversify portfolios, aiming for stable performance through careful debt-instrument selection that align with the fund’s objective.
• Investors enjoy higher liquidity than Fixed Deposits because debt funds do not require a fixed lock-in period.
• Indexation benefits make debt funds more tax-efficient for long-term investors seeking reduced tax liability.
• Debt funds suit individuals who want moderate returns while accepting some degree of risk exposure in their investments.

Comparing Fixed Deposits and Debt Mutual Funds

Choosing Debt Mutual Funds and Fixed Deposits (FDs) depends on your investment goals.

Factor	Fixed Deposits (FDs)	Debt Mutual Funds
Returns	FDs offer fixed interest rates. Returns do not change with market conditions.	Debt funds provide market-linked returns. Performance depends on interest rate movements.
Risk	FDs carry minimal risk as banks guarantee returns.	Debt funds have moderate risk due to market fluctuations.
Liquidity	FDs have a lock-in period. Premature withdrawal attracts penalties.	Debt funds allow withdrawals anytime. Some may have an exit load.
Investment Tenure	FD is ideal for short to medium-term financial goals.	Debt funds are suitable for both short and long-term investments.

When should you choose Fixed Deposits?

Let us explore some criteria that make FDs suitable. 

• If you prefer guaranteed returns without market risk.
• If you need a secure investment for short-term savings.
• If you want a predictable income source for retirement.
• If you have a low-risk tolerance and seek capital protection.

Use a Fixed Deposit calculator to compare interest earnings across different tenures and banks.

When should you choose Debt Mutual Funds?

Let us explore some criteria that make Debt Mutual Funds suitable.

• If you can tolerate moderate risk for higher returns.
• If you need liquidity with no strict lock-in period.
• If you want tax-efficient returns for long-term goals.
• If you seek diversification in a fixed-income portfolio.

Conclusion

Fixed Deposits and debt mutual funds serve different investment needs. FDs offer security and fixed returns, while debt mutual funds provide liquidity and tax efficiency. Choose FDs for stability and guaranteed income. Opt for debt mutual funds if you seek flexibility and market-linked returns. Evaluate your financial goals and risk appetite before making a decision.

How Much Monthly Interest Can You Earn from Fixed Deposit?

Fixed Deposits (FDs) are one of the most popular investment options in India, offering a safe and reliable means to grow your savings. Among the various types of FDs available, those that offer monthly interest payouts may be attractive for individuals looking for a regular stream of income. Understanding how much monthly interest you could earn from a fixed deposit may help you plan your finances better.

Understanding Fixed Deposits with Monthly Interest Payouts

A fixed deposit with a monthly interest payout option allows investors to receive the interest earned at the end of each month. This type of FD, often referred to as a monthly interest payout FD, could be ideal for retirees. It may also be useful for those seeking a steady income stream without disturbing their principal investment.

Factors Affecting Monthly Interest Payout from FDs

Several factors influence the amount of monthly interest you can earn from a fixed deposit:

• Interest Rate: The rate offered by the bank or NBFC is an important factor. Higher interest rate on fd result in higher monthly payouts.
• Deposit Amount: The principal amount you invest directly impacts the interest earned. Larger deposits yield higher interest.
• Tenor: The duration of the fixed deposit also plays a role. While the monthly interest payout option provides regular income, the interest rate might vary based on the tenor chosen.
• Compounding Frequency: The frequency of interest compounding (monthly, quarterly, half-yearly, or annually) can affect the total interest earned. However, it may be less relevant for monthly payout FDs since the interest is not compounded.

Calculating Monthly Interest for Different Deposit Amounts

To understand how much monthly interest you can earn from a fixed deposit, let’s take a look at some examples. We will consider different deposit amounts and typical interest rates offered by banks and NBFCs. The monthly interest can be calculated using the formula:

Monthly Interest = Principal × Annual Interest Rate/12 x 100

Example 1: Monthly Interest for ₹1 Lakh Fixed Deposit

Consider an example where you invest ₹1 Lakh in a fixed deposit with an interest rate of 6% per annum, and opt for the monthly interest payout option. The monthly interest would be:

Monthly Interest = 1,00,000 × 6/12 x 100 = ₹500

So, for a ₹1 Lakh fixed deposit at 6% p.a., you would earn ₹500 per month.

Example 2: Monthly Interest for ₹5 Lakhs Fixed Deposit

For a higher deposit amount of ₹5 Lakhs with the same interest rate of 6% per annum, the monthly interest would be:

Monthly Interest = 5,00,000 × 6/12 x 100 = ₹2,500

Thus, a ₹5 Lakhs fixed deposit at 6% p.a. would yield ₹2,500 per month.
Example 3: Monthly Interest for ₹10 Lakhs Fixed Deposit

For an even larger deposit amount of ₹10 Lakhs with an interest rate of 6% per annum, the monthly interest calculation would be:

Monthly Interest=10,00,000×6/12x100=₹5,000

Therefore, a ₹10 Lakhs fixed deposit at 6% p.a. would provide a monthly interest income of ₹5,000.

Benefits of Monthly Interest Payout Fixed Deposits

Opting for an FD with a monthly interest payout has several benefits:

• Regular Income: Provides a steady income stream for those looking to supplement their income or interest in a fixed income scheme.
• Budgeting: Helps in better financial planning and budgeting as you receive a fixed amount every month.
• Liquidity: Ensures liquidity by providing monthly interest, which can be used for monthly expenses without breaking the FD.Taxation on Interest Earned

The interest earned from fixed deposits is taxable under the Income Tax Act, 1961. The interest income is added to your total income and taxed according to your income tax slab. Banks and NBFCs deduct Tax Deducted at Source (TDS) if the interest income exceeds ₹40,000 (₹50,000 for senior citizens) in a financial year.

To optimise your post-tax returns, consider splitting your deposits across different banks or NBFCs. Alternatively, you could invest in a tax-saving fixed deposits with a 5-year lock-in period.

Tips for Maximising Monthly Interest from Fixed Deposits

Here are some tips to help you maximise the monthly interest earned from your fixed deposits:

• Compare Interest Rates: Regularly compare FD interest rates offered by different banks and NBFCs to ensure you are getting the best possible rate.
• Opt for Senior Citizen Rates: If you are a senior citizen, take advantage of higher interest rates offered specifically for you.
• Choose the Right Tenor: Select a tenor that aligns with your financial goals and offers the best interest rates. Longer tenors often come with higher rates.
• Diversify Investments: Spread your investments across multiple banks or NBFCs to maximise returns and minimise risk.
• Reinvest Interest: If you don’t need the monthly interest for expenses, consider reinvesting it in another FD to benefit from compounding.

Fixed deposits with monthly interest payouts can be a good option for individuals seeking a reliable and regular income stream. By understanding the factors that influence the monthly interest earned and strategically selecting the best rates and tenors, you can optimise your returns from these investments. Whether you are looking for a steady income or simply want a safe investment option, fixed deposits could be a powerful tool in your financial planning.

Calculating the monthly interest for different deposit amounts helps in planning your finances effectively. With careful selection and management of your FDs, you could enjoy a stable and predictable income, ensuring financial stability and peace of mind.

A Comprehensive Guide on How to Calculate Your Fixed Deposit Interest

When it comes to risk-averse and long-term investment options, fixed deposits are among the most preferred choices. In FDs, you can park a lump sum amount for a fixed tenor and earn interest at a fixed rate for a predetermined period.

The interest rate depends on the tenor you choose. However, the FD rate of interest is fixed at the outset of the investment and remains unchanged throughout the tenor. If you withdraw your FD before the end of the tenor, the issuer will likely lower the interest rate as a penalty.

If you wish to calculate the interest on your FD, you can use a fixed deposit calculator. However, having an understanding of how banks and NBFCs calculate your interest will help you determine your returns.

Read on to learn more about how issuers compute the interest on your FD.

How Issuers Calculate Interest on Fixed Deposits

The method to calculate interest on fixed deposits depends on the type of FD investment. There are two types of FD accounts: simple interest and compound interest. Here is the formula to calculate interest in both ways:

Simple Interest

You can calculate the interest on a simple interest fixed deposit using the following formula:

M = P + (P x R x T/100)

Here,
M is the amount at the time of maturity
P is the principal amount
R is the rate of interest
T is the tenor year

For an instance, if you invest ₹1 Lakh in a simple interest FD with a tenor of 3 years offering an interest rate of 7% p.a., the maturity amount at the end of the tenor would be:

M = 1,00,000 + (1,00,000 x 7 x 3 / 100)
M = ₹1,21,000

Compound Interest

There are also certain types of FDs where the interest earned is compounded annually. Here is how you can calculate the maturity amount for compound interest FDs:

M = P + P {(1 + I/100) T – 1}

Here,
M is the amount at the time of maturity
P is the principal amount
I is the rate of interest per period
T is the tenure

For example, if your investment terms are the same as the above-mentioned SI FD example, then the maturity amount for compound interest FD will be:

M = 1,00,000 + 1,00,000 {(1 + 7/100) 3 – 1}

M = ₹1,22,504

As you can see, an FD with compounding interest gives you higher returns than an FD with simple interest.

How to Calculate Interest on Fixed Deposits via a Fixed Deposit Calculator

While you can use the above-mentioned formulas to calculate your FD interest, this process may not be free from manual error. In addition, if you are comparing multiple FDs, this method can also be quite tedious and lengthy.

However, to calculate your FD interest quickly and without manual errors, you can use a fixed deposit calculator, which is available online. This is a simple digital tool that gives you estimates of your maturity amount and interest earned in just a few minutes.

Here is a step-by-step guide on how to use a fixed deposit calculator.

Step 1: Visit a fixed deposit calculator webpage (available on most issuers’ website or app)

Step 2: Choose the FD type and investor type

Step 3: Enter the investment amount and tenor

Step 4: Select the interest rate (some calculators may fill the rate automatically)

Step 5: Click on submit

Once you submit these details, the page will display an estimate of your earnings. You can then adjust the terms to understand the ideal terms. For example, you can even calculate a ₹1 Lakh fixed deposit’s interest per month. All you need to do is choose the monthly payout option and tweak the numbers until you get the desired figure.

Advantages of Using a Fixed Deposit Calculator for Computing Interest

Here are the advantages that you can enjoy by using a fixed deposit calculator:

• A fixed deposit calculator provides accurate calculations
• As opposed to manual methods, you can get results instantly, within seconds
• Most fixed deposit calculators are free to use and have no restrictions
• Since they are available online, calculations are quite easy and convenient to access

Factors that Affect Fixed Deposit Interest Rates

Interest rates directly impact your earnings on an FD investment. To maximise your returns, it is crucial to know about the factors that influence these rates. Here are some factors that impact the rate of interest on fixed deposits:

Repo Rate

The primary factor that influences spikes or falls in FD interest rates is the repo rate decided by the Reserve Bank of India. It is the rate at which the central bank lends money to other banks and has a directly proportional relationship with FD interest rates. However, keep in mind that once you book an FD, any fluctuations in the repo rate will not affect your FD rate.

Investment Horizon

As mentioned earlier, FDs with longer tenors generally have higher interest rates. For instance, you may get 7% interest on an FD for 12 months. On the other hand, most FD issuers offer an interest rate of over 8% p.a. on a longer tenor of about 60 months.

It is also important to note that some FD issuers offer the best interest rates for special tenors. For example, the Bajaj Finance FD offers up to 8.60% as the interest rate for a tenor of 44 months. However, for 60 months, the interest rate is up to 8.30%.

FD and Investor Type

The type of FD investment also impacts the interest rate on your investment. This is because cumulative FDs offer higher interest rates as compared to non-cumulative FDs.

Therefore, if you opt for a ₹1 Lakh fixed deposit to earn interest per month, it will be less rewarding. Whereas, opting for payout at maturity could fetch you better returns.

Also, remember that most issuers offer higher interest rates to senior citizens. Generally, investors who are 60 or above can enjoy 0.25% to 0.75% higher interest rates than non-senior citizen investors.

Now that you know how FD issuers calculate your interest gains, be sure to calculate yours before investing. This will allow you to choose the right investment terms and ensure that you have the required funding to meet your goals.

With the fixed deposit calculator available online, you can easily get an estimate in minutes. However, remember that the actual earnings may vary due to taxes and when the FD compounding is done by the financial institution. So, it is best to keep a buffer while investing.

5 Features & Benefits of Fixed Deposits for Your Investment Portfolio

There are plenty of investment opportunities that investors can choose from based on their risk appetite, investment horizon, and goals. From equities to mutual funds to real estate and even debt instruments- investors are spoilt for choice when it comes to picking an investment vehicle. However, there are more conventional investment options that offer stable returns at minimal to no risk.

Fixed deposits are one such asset class that’s gained popularity for carrying no risk and steady returns. Read on to know about the benefits of FDs, their features, and more.

What are fixed deposits?

A fixed deposit receipt is an instrument issued by banks and financial institutions that promises to pay interest on deposits made for a certain period.

When you open a fixed deposit (FD), your money is locked in for a specified period. At the end of the term, i.e. after the maturity period, the bank pays you back your principal amount plus a certain interest, which is your return.

Fixed deposits offer several advantages over time. Read further to understand its features and benefits.

Features of fixed deposits

While experts recommend having a decent quantum of FDs in an investment portfolio, you must look at their features to understand them better. Here are some of the most common features of an FD.

1. Secure investment instruments

The most important feature of a fixed deposit is that it is risk-free. Compared to other investment options that are significantly influenced by market conditions, fixed deposits are a safe investment option. FD returns are fixed and thus are a reliable investment option. At the end of the maturity period, you get guaranteed returns.

2. Interest rate

FDs offer a steady interest as a return on the principal investment. These interest rates are typically higher than that of a savings account. It is important to note that interest rates fluctuate and are affected by market conditions. Moreover, the principal amount deposited and tenure also directly impact the interest income.

The interest is paid periodically or fully on maturity, depending on your preference. You may also note that senior citizens are offered higher interest rates.

3. Age and investment limit

An individual over 18 years of age can open an FD. Minors may also open their accounts, but they must be managed by a guardian. Additionally, FDs require a minimum investment amount of Rs. 1,000, although there is no maximum limit. However, do note that higher deposits attract higher interest income.

4. Tenure

FDs are a long-term investment option. The maturity period can range anywhere from 7 days to 10 years. The investor has the choice to choose the tenure. Upon maturity, the FD can be set for renewal.

5. Penalty

An important feature to note about FDs is that they attract penalties on premature withdrawals. The penalty will depend on many factors like days since opening etc.; This feature makes FDs illiquid instruments.

Benefits of FDs

1. Guaranteed returns

FD returns are guaranteed unlike other investment options like equities and mutual funds, where market factors determine returns. This is one of the most important benefits FDs lend to its investors, making it an extremely attractive and popular investment avenue.

2. Risk-free

As they offer guaranteed returns, FDs carry minimal to no risk. This benefit can be used to hedge your portfolio against risk from other investment avenues. Even if you experience losses on your other investments, FD returns can help offset them. Thus, they can be an ideal addition to your portfolio.
Tax benefit

FD interest income can be deduced when filing returns. Tax saving fixed deposits allow for a maximum of Rs. 1.5 lakh tax deduction under Section 80C of the Income Tax Act of 1961. So while you earn interest, you pay no taxes, making it a win-win situation.

3. Loan facility

You can draw up a loan against your FD investments. If you need funds, you can draw a loan against your FD, up to 90% of the invested amount.

Your wealth experiences compounding when locked in an FD, compared to the same money lying idle in a savings account. If the investment is not withdrawn and allowed to grow, the compound interest accumulated can grow multifold.

Conclusion

A fixed deposit is a deposit you make with a bank or any financial institution that earns interest at a fixed rate and is locked in until maturity. The features and benefits of FDs make them a must-have in any investment portfolio. They also can help balance the risk factor in your portfolio. So consider all the pointers mentioned above before investing in FDs.

FAQs

Q1. How to open an FD?

Ans. You can visit the bank of your preference to open an FD in a hassle-free manner. Alternatively, you can open an FD online by visiting the website of the bank you choose in just a few minutes.

Q2. What is the highest interest rate offered on FD in India?

Ans. The interest rate on FDs can go as high as 7% or even more. The interest rate is influenced by many factors like economic conditions, etc.

Q3. Are FDs better than stock investments?

Ans. All investment options have their own pros and cons. While equities offer great returns, the risk is extremely high. On the other hand, FDs may offer standard returns at minimal risk. Your choice and preference should be based on your risk tolerance.

What Makes a Fixed Deposit a Safe Investment Option?

In the life of every investor, a period of investment analysis comes every year. It is when he wants to look into the investments he made, the returns earned, and how he can diversify his investment portfolio. As an investor, you want to ensure you gain more and worry less about the risk related to various investment instruments. Undoubtedly, a stressful challenge you face while building an investment plan is to identify instruments where you can invest.

Indeed, your investment decisions must be aligned with your needs and goals. However, Fixed Deposit or FD is one of those few instruments that can become a part of every investment portfolio. It has stood the tests of time to work as one of the smartest choices for all investors.  

Here are a few reasons that make FD investments a safe bet aligned to your future goals:

 

It’s Risk-free

 

The first thought that comes to mind when you invest money is – ‘Will my money stay safe in this investment option?’ 

If you can’t afford to bear the risk of money loss with your investment decisions, you won’t prefer investing in high-risk instruments such as equities and mutual funds. However, investing in an FD is the safest option that you can choose to park your money with a reputable bank. The corpus you set aside in a fixed deposit will stay safe over the chosen tenure, and you will get an assured benefit afterwards. Plus, you can check the safety of this financial product in terms of CRISIL ratings, the highest being FAAA (F Triple-A). 

If you are a beginner investor, having an FD in your portfolio will help you balance out the overall risk factor.

 

It Gives Assured Returns

 

Ask your peers or parents about investing in an FD, and the first thing you will hear about it is the related returns. Take the case of fixed Deposits in a bank with CRISIL rating of FAAA/Negative. You can get more than eight percent annual returns of the amount you invest. 

Unlike other investment products whose returns are highly dependent on market volatility, an FD can give you fixed monetary benefits. Knowing that you will gain some extra income at the end of your FD’s tenure, you can plan your life goals with it. For instance, you can invest a specific amount in an FD with a monthly payout option to get returns in the form of a regular monthly income in your retirement life. 

 

It Comes with the Flexibility to Choose Tenure

 

Next to the returns you get with an investment, you also want to know for how long you need to set the corpus aside. This is important for you as you may not be able to get the total invested money back whenever you need it. 

Another significant benefit of investing in FD is that you enjoy the flexibility to choose its tenure, which varies from seven days to a few years. You can put your money in a short-term deposit for seven days and get it back on the eighth day with the earned returns. On the other hand, you can opt for cumulative fixed deposit for ten years wherein your money will keep on reinvesting every year. You will get you compounded interest at the end of your FD’s tenure. 

 

It Can Give You Tax-Benefits

 

As an investor, you can claim tax deductions for the money you invest in tax saver fixed deposits as per Section 80C of the Income Tax Act. These FDs have a lock-in period of five years, and you can earn interest on your investments at the rate varying from 5.5% to 7.75%. Also, the interest you earn in this type of FDs is taxable.

You will get more returns by investing your money in an FD than keeping it in a bank’s savings account. If you have a lower risk appetite and assured returns on your investments, start investing in FDs.