Over the last few quarters, we are seeing interest rates gradually on the rise. This has benefited individuals like retired folk, who depend on interest income. Here are a few deposits, which could yield much superior returns for investors and are relatively safe.
Mahindra Finance offers an interest rate of 9 per cent for those opting for the online facility. This is the best in class deposit interest rates, from a company, whose deposits have been rated as AAA.
A 33-month deposit in the Mahindra Finance FD offers an interest rate of 9 per cent, with a yield of high as 9.76 per cent. On the other hand a 4-month deposit offers an interest of 9 per cent as well, with a yield of a superb 10 per cent.
A 15-month deposit offers an interest rate of 8.30 per cent. The deposits are AAA rated and hence can be considered as safe.
Bajaj Finance has also hiked its interest rate recently, and now offers an interest rate of 8.75 per cent on its cumulative deposits. This is for a period of 36 to 60 months. The 12-23 month tenure offers an interest rate of just 8 per cent.
Like Mahindra Finance, Bajaj Finance's deposits too are AAA rated and hence very safe. Investors may not want to consider very long term time frame, as interest rates may rise over the longer term. So, a time frame of 1-2 year for a deposit would be safe.
Bajaj Finance is a good deposit to consider, if you are looking at safety and superior returns.
This is a government of Kerala backed institution and the deposits are guaranteed by the government of Kerala. The institution also known as Kerala Transport Development Finance Corporation (KTDFC), offers an interest rate of 8.50 per cent on its 1, 2 and 3 year deposit.
The deposits for a period of 1 and 2 years is 8 per cent. It is also important to remember that the interest rate is compounded monthly against, quarterly compounding by banks. Again, we suggest that investors invest for a shorter duration, as interest rates maybe headed higher in the short to medium term.
It is also important to remember that there is a tax liability on FDs. So, factor the same in, if you are having a tax liability.
Shriram Transport Finance FDs
The Shriram Transport Finance FDs give you an interest rate of 8.88 per cent on a 60-month FD. The effective yield on the same is 11.13 per cent. There is an additional interest of 0.25% p.a on all renewals, where the deposit is matured on or after 1st November 2018.
There is also an additional interest of 0.15% p.a to employees of Shriram Group Companies and their relatives.