Fixed Deposits (FDs) are among the most trusted investment options in India. But when choosing between a Bank FD and a Corporate FD, the decision can be confusing. While both offer fixed returns, the risk, interest rates, and regulation vary significantly.
This guide simplifies the comparison—so you can make a smart, risk-adjusted choice for your money.
Corporate FD vs. Bank FD
Compare Corporate FD vs Bank FD to know which gives better returns, safety, and benefits. Pick the right fixed deposit that matches your investment goals
What is a Bank Fixed Deposit?
A Bank FD is a secure investment where you deposit a lump sum amount with a commercial bank for a set tenure, earning interest at a predetermined rate.
Key features:
- Regulated by the Reserve Bank of India (RBI)
- Deposits up to Rs. 5 lakh are insured by DICGC
- Ideal for conservative investors seeking stable returns
- Premature withdrawal facility is often available
What is a Corporate Fixed Deposit?
A Corporate FD is offered by NBFCs or companies to raise funds from the public. These typically offer higher interest rates than bank FDs but come with a slightly higher credit risk.
Key features:
- Regulated under the Companies Act and SEBI
- Interest rates (based on credit rating)
- Rated by agencies like CRISIL or ICRA
- Suitable for investors with a moderate risk appetite
Want capital safety and peace of mind?
Open an FD Account online with Bajaj Finance and start earning assured returns of up to 7.30% p.a. today!
Difference between Corporate FDs and Bank FD
| Feature | Bank FD | Corporate FD |
| Issuer | Commercial Banks | NBFCs/Companies |
| Safety | High – RBI regulated | Moderate – Based on credit ratings |
| Returns | ~5% to 8% p.a. | Up to ~8.6% p.a. |
| Liquidity | High – Early withdrawals allowed | High – Early withdrawals allowed |
| Best For | Risk-averse investors | Risk-averse and yield-seeking investors |
Unsure which FD tenure is right for you?
Use our FD Calculator to compare returns according to the chosen tenures by Bajaj Finance in real time. Book a AAA-rated Bajaj Finance FD as per your requirement!
Benefits of Bank FDs
- Low-risk and predictable returns
- Deposits insured up to Rs. 5 lakh
- Flexible tenure options with early withdrawal (with some penalty charges)
- Easy to open and manage online or offline
Perfect for:
- Retired individuals
- First-time investors
- Emergency fund parking
Benefits of Corporate FDs
- Higher interest rates than traditional bank FDs
- Flexibility in tenure selection (1–5+ years)
- Suitable for portfolio diversification
- Backed by independent credit ratings. For example, Bajaj Finance FDs are AAA rated by CRISIL and ICRA (highest ratings in the market)
Perfect for:
- Professionals saving for short/medium-term goals
- Investors looking to beat inflation with fixed returns
- Those comfortable with minimal risk for better gains
Want more from your FD?
Check Eligibility for Bajaj Finance AAA-rated Fixed Deposits and take the next step towards building a safe financial future.
Conclusion
Both Bank FDs and Corporate FDs can be valuable additions to your financial portfolio—but they serve different needs.
If your priority is capital safety, bank FDs work best.
- If you're looking for higher returns, corporate FDs offer great value.
- The smartest approach? Diversify between both, based on your goals.
Calculate your expected investment returns with the help of our investment calculators
| Investment Calculator | ||
| FD Return Calculator | Sukanya Samriddhi Yojana Calculator | PPF Calculator |
Frequently Asked Questions
Is it good to invest in corporate FD?
Corporate Fixed Deposits (FDs) can be a good investment option if you are looking for higher interest rates compared to traditional bank FDs. They are offered by Non-Banking Financial Companies (NBFCs) and corporates, and many provide flexible tenures, regular interest payouts, and features like loans against FD.
However, unlike bank FDs that are covered by deposit insurance (up to Rs. 5 lakh), corporate FDs are not insured. The safety of your money depends on the credit rating of the company. Choosing a reputed issuer with a high credit rating (AAA/AA) is crucial to reduce risk. So, corporate FDs are good for investors who want better returns and are comfortable taking on slightly higher risk.
What is the difference between corporate FD and normal FD?
A bank FD is issued by commercial banks and offers lower but safer returns, regulated by the RBI. A corporate FD is offered by companies or NBFCs, providing higher interest rates but with slightly higher risk. Bank FDs ensure capital protection, while corporate FDs focus on maximising returns.
Is corporate bond better than FD?
Corporate Bonds and Corporate FDs both offer fixed returns but differ in terms of risk, liquidity, and tax treatment:
- Corporate Bonds generally offer higher returns and can be traded in the secondary market, giving you liquidity before maturity. They are also regulated by SEBI, making them relatively transparent. However, their market-linked nature means bond prices can fluctuate, adding an element of risk.
- Corporate FDs provide guaranteed fixed returns and are simpler to understand, but they usually lock in your money until maturity (unless you opt for premature withdrawal with penalties).
Are corporate FDs safe to invest in?
Yes, provided you choose FDs issued by highly rated companies (e.g., CRISIL AAA-rated). Always review the issuer’s creditworthiness before investing. For added peace of mind, explore trusted names like Bajaj Finance FD. Check eligibility for a Bajaj Finance FD now!
More Articles
Related Videos
Bajaj Finance Fixed Deposit: Trusted by India
FD & The Power of Compounding
Make your money work hard with FD
Why choose Bajaj Finance Fixed Deposit
Bajaj Finserv App for All Your Financial Needs and Goals
Trusted by 50 million+ customers in India, Bajaj Finserv App is a one-stop solution for all your financial needs and goals.
You can use the Bajaj Finserv App to:
- Apply for loans online, such as Instant Personal Loan, Home Loan, Business Loan, Gold Loan, and more.
- Explore and apply for co-branded credit cards online.
- Invest in fixed deposits and mutual
- funds on the app.
- Choose from multiple insurance for your health, motor and even pocket insurance, from various insurance providers.
- Pay and manage your bills and recharges using the BBPS platform. Use Bajaj Pay and Bajaj Wallet for quick and simple money transfers and transactions.
- Apply for Insta EMI Card and get a pre-approved limit on the app. Explore over 1 million products on the app that can be purchased from a partner store on Easy EMIs.
- Shop from over 100+ brand partners that offer a diverse range of products and services.
- Use specialised tools like EMI calculators, SIP Calculators
- Check your credit score, download loan statements and even get quick customer support—all on the app.
Download the Bajaj Finserv App today and experience the convenience of managing your finances on one app.
Download App
Now request money from your friends and family and make instant payments.
- 1. Apply for Loans: Choose from personal, business, gold loans and more
- 2. Transact: Pay utility bills, use UPI, get FASTag and more
- 3. Shop: Buy over 1 million products on No Cost EMI
- 4. Invest: Buy stocks, mutual funds and invest in FD