What is a Post Office fixed deposit?

A Post Office fixed deposit, also known as a Post Office term deposit, is an FD issued by the Indian Postal Services. Post Office FDs are backed by the sovereign guarantee of the Government of India.

Post Office Fixed Deposit Rates 2021

Fixed Deposit is one of the safest investment avenues offered by banks, Non-Banking Financial Companies (NBFCs) and post offices. Post Office Fixed Deposit, also known as Post Office Term Deposits, are investment instruments offered by the Indian Postal Services. It is a preferred investment option for those looking for a safe investment avenue, these post office FDs are backed by the sovereign guarantee of the Government of India.

Features Table of Post Office Fixed Deposit

Particulars Details
Tenure 1, 2, 3 and 5 years
Minimum Deposit Amount Rs. 1,000
Interest Rates 5.5% – 6.7%
Interest Payment Annually
Mode of Payment Cash/Cheque
Premature Withdrawal Allowed after 6 months*
Nomination Facility Available

*If account is closed between 6 to 12 months from the date of opening, then Post Office Savings A/c rates will be applicable.

Post Office FD Interest Rate:

Post Office Fixed Deposit interest rates are decided by the Government of India (every quarter) under Small Saving Schemes. These rates are in turn determined as per the performance of government securities/bills. A Post Office fixed deposit with a tenor of 5 years has an interest rate mark-up of 25 bps over the yield of comparable government securities.

Tenor (years) Post Office FD Interest Rates
1 year 5.5%
2 years 5.5%
3 years 5.5%
5 years 6.7%

Here’s a comparison of latest FD interest rates offered by post offices, with FD rates offered by Bajaj Finance Limited.

Tenor (years) Post Office FD Interest Rates Bajaj Finance FD Interest Rates
1 year 5.5% 5.65%
2 year 5.5% 6.10%
3 year 5.5% 6.50%
5 year 6.7% 6.50%

Bajaj Finance offers additional 0.10% higher FD interest rates on investing in an end-to-end online FD for non-senior citizens. This rate benefit is not applicable for senior citizens, as they can get 0.25% additional returns on their deposit.

Features and Benefits of Bajaj Finance Fixed Deposit

Interest Rate Ranging from 5.65% to 6.75%
Minimum Tenor 1 Year
Maximum Tenor 5 Years
Deposit Amount Minimum deposit of Rs. 25,000
Application Process 100% online process
Online Payment Options Netbanking and UPI

Post Office Fixed Deposit vs Bajaj Finance Fixed Deposit

While you can think of redirecting the interest earned from Post Office FD into various other post office schemes, you should also consider alternative options such as high-yielding company FDs offering a similar guarantee with zero to low risk.

Even though post office FD may offer a higher interest rate as compared to bank FD, it cannot match the interest rate offered by Company FDs. You can ensure maximum returns with company FDs which are guaranteed by well-financed and liquid companies like Bajaj Finance. Let us see how you can benefit even further with a Bajaj Finance FD.

  • Investment rate – Bajaj Finance FD offers higher interest rates up to 6.75% which is higher than any other fixed-income option given the current state of the economy. A post office FD will allow a maximum of 5.7% and this can get further reduced if the G-sec yield falls.
  • Flexibility – Bajaj Finance FD offers flexible terms for premature withdrawal (as compared to Post Office FD). It also provides an option to avail loan against FD at a marginal interest rate.
  • Ease of access – While a post office FD may not offer you many online features, you can easily invest in a Bajaj Finance online FD that enables you to reap the benefit of an end-to-end online paperless procedure. Additional features of doorstep document pickup, multi-deposit and auto-renewal make it even more convenient. You can open a Bajaj Finance online FD account by just using a debit card at a few locations.

Bajaj Finance also accepts deposits from NRIs, and is rated high on the safety and stability ranking, which makes it one of the best investment options for those with lower risk appetite. To help you compare the features of Post Office Fixed Deposit and Bajaj Finance Fixed Deposit, here’s a table detailing the differences between the two:

High-Interest Rate No Yes
Quarterly Interest Rate Revision Yes No
Flexible Premature Withdrawal No Yes
Online Account Management No Yes
Multi-deposit Facility No Yes
Auto-Renewal Facility Only at CBS-enabled branches Yes

With 2.35 lakh customers and a total deposit book size of more than 20,000+ crores, you can trust a Bajaj Finance FD to give you maximum returns at little to no risk. Bajaj Finance offers higher FD interest rates to senior citizens and those applying online.

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