Fixed deposits (FD) are one of the most popular traditional investment methods.
What is FD Plus?
FDs offer assured returns after a certain pre-decided duration or tenure. But, as an investor you can always break the FD before the pre-decided tenure, only a small percentage will be deducted from your investment. However, FD plus indicates those investments, where this facility is not available. No premature withdrawal facility will be provided to the investors in case of FD plus, except in case of death of the account holder or on order from statutory and/or regulatory authority.
Here, the FD plus rates by Jana Small Finance Bank has been discussed. These latest FD interest rates came into effect on May 24, 2022.
Jana Small Finance Bank Domestic Fixed Deposit (Plus) Rates
For Jana Small Finance Bank account holders, the Fixed Deposit (Plus) rate for 1 year is 6.50%, the FD (Plus) rate for 1 Year - 2 Years is 7.20%, the FD (Plus) rate for 2 Years - 3 Years is 6.85%, the FD (Plus) rate for 3 Years - less than 5 Years is 6.85%, the FD (Plus) rate for 5 Years is 6.85%, and the FD (Plus) rate for more than 5 Years - 10 Years is 6.00%.
Best FD interest rates
|FD Tenure||Interest Rate (p.a.)|
|1 Year - 2 Years||7.20%|
|2 Years - 3 Years||6.85%|
|3 Years - < 5 Years||6.85%|
|5 Years (1825 Days)||6.85%|
|> 5 Years - 10 Years||6.00%|
These mentioned rates are the same for any amount, but the FD plus option can be availed only for Fixed Deposits above Rs. 15 Lakhs only. Also, the rates for public and senior citizens are the same. Compared to normal domestic FDs, these FD plus rates are marginally higher. A normal FD for the public offers 7% interest on an above 3 Years to less than 5 Years FD. But, for FD plus, you can have 7.20% interest on a 1 Year - 2 Years FD. However, RBI, the central bank of India insures FDs for Rs. 5 lakhs. But these above-mentioned interest rates are applicable for the investment above. Rs. 15 Lakhs. So, one should also think about the risk factors.
Additionally, Jana Small Finance Bank informs, "In case of premature withdrawal of fixed deposit, the Interest rate applicable for premature closure will be lower of the rate for the original /contracted tenure for which the deposit has been booked or, the rate as prevailing on the date of deposit for the tenure for which the of deposit has been in force with the Bank."
Advantages and Disadvantages
However, investors should remember that the interest rates given on the FD are subject to change from time to time. The rates can depend on multiple factors like RBI repo rate change, the bank's Board's decisions, etc. So, investors should be ready for the changes. In the case of FD, mostly premature withdrawals are available, but investors do not prefer to follow that. Because already FDs offer much lesser returns than investment tools with risks (like stocks). The premature withdrawal of an FD will additionally reduce its returns.
Additionally, on that matter, many investment analysts suggest that short-term FDs are better than long-term FDs, because the rate of inflation in India is very high. Compared to that, FDs are not providing highly lucrative returns in the long run.