Fixed Deposit

Fixed deposit is financial instrument which earn a fixed interest over a period of time and the rate of interest in these deposits are determined by the tenure of deposit and other allied factors. Generally fixed deposit are issued by Financial Institution, Manufacturing Companies , Real Estate companies and NBFC. In fixed deposits corporate fixed deposits provide higher rate of interest compared to bank deposits. They are a good source of regular income by means of monthly, quarterly, half-yearly, or yearly interest income. Corporate fixed deposits usually are unsecured in nature . Hence while investing in these corporate deposit one should review financial performance of companies . The deposit made in a company fixed deposit is governed by section 58A of the Companies Act 1956.

Salient Features of Corporate Fixed Deposits:
  • High Interest rate
  • Short term deposit
  • Doorstep deposit and redemption facility
  • No income tax deducted for interest up to 5000Rs.
  • Higher Interest rates for senior citizens
  • You can choose interest frequency; most issuers offer monthly, quarterly, bi annual and annual cumulative deposits
  • You get direct ECS credit facility for interest payments or advance interest warrants for the year issued by most issuers.
  • Private Limited Company

    A private limited company is the most reputed form of carrying business in India. The minimum number of members in private limited company is 2 and maximum number of members is restricted to 50. A private limited company is considered as a separate legal entity. A private limited company name ends with ‘Private Limited’.

  • Public Limited Company

    The Company is a Public Limited Company which is incorporated under companies Act and has minimum paid-up capital of Rs. 5 lakhs.In a public limited company, minimum number of shareholders is 7 and minimum number of director is 3.

  • Section25 Company

    This section empowers the Central Government to grant a license directing that such an association may be registered as a company with limited liability, without the addition of the Words `Limited’ or `Private Limited’ to its name.

  • Limited Liability Partnership

    A Limited Liability Partnership (LLP) is a one form of body corporate which was introduced in India by the Limited Liability Partnership Act, 2008.