Term Deposit or Fixed Deposit

Read on to discover more about term deposits and fixed deposits.
3 mins
20 July 2023

When it comes to investing your money, there are several options available, with fixed deposits and term deposits being two of the most popular choices. While both these investment options have similar features, there are significant differences between them that you should know before making an investment decision. In this article, we will compare term deposit vs fixed deposit and help you understand which option is best for you.

What is the Meaning of Term Deposit?

A term deposit, also known as a time deposit, is a type of investment where you deposit your funds for a specific period, ranging from one month to five years. When you invest in a term deposit, you agree to leave the funds in the account for the entire term, without making any withdrawals or additional deposits. Term deposits usually offer a fixed interest rate and the return on investment is guaranteed.

Characteristics of Term Deposit

The following are some of the main characteristics of term deposits:
- Fixed tenure: Term deposits have a fixed tenure, and you cannot withdraw the funds before the maturity date.
- Fixed interest rate: The interest rate offered on term deposits is usually fixed, and the return on investment is guaranteed.
- Low-risk investment option: Term deposits are a low-risk investment option, making it an ideal choice for risk-averse investors.

What is the Meaning of a Fixed Deposit?

A fixed deposit, also known as a term deposit, is a type of investment where you deposit your funds for a fixed period, ranging from a year to 5 years. The amount you deposit and the tenure are fixed at the time of investment. Fixed deposits usually offer a fixed interest rate and the return on investment is predictable.

Characteristics of the Fixed Deposits

The following are some of the main characteristics of fixed deposits:
- Fixed amount and tenure: The amount and tenure of fixed deposits are fixed at the time of investment. You can make premature withdrawals but also attract early withdrawal penalties.
- Fixed interest rate: The interest rate offered on fixed deposits is usually fixed, and the return on investment is guaranteed.
- Low-risk investment option: Fixed deposits are a low-risk investment option, making it an ideal choice for risk-averse investors.

How to Invest in a Bajaj Finance Fixed Deposit?

To invest in a Bajaj Finance Fixed Deposit, you need to follow the below steps:

  1. Visit our Investment section and choose Fixed Deposit from the options.
  2. Click on ‘Open FD' at the top of the fixed deposit page to open our online application form.
  3. Enter your 10-digit mobile number and verify the OTP sent to your phone.
  4. Fill in the investment amount, choose the investment tenure and the payout frequency. Enter your PAN card and date of birth.
  5. Complete your KYC: If you are an existing customer, confirm the details available with us, or edit to make any changes. For new customers, complete your KYC using Aadhaar.
  6. A declaration will be displayed. Please read it carefully and agree to the terms and conditions. Enter your bank details and proceed to pay.
  7. Complete your investment using NetBanking/ UPI or NEFT/ RTGS.

In conclusion, both term deposits and fixed deposits are safe and secure investment options, suitable for risk-averse investors.

Disclaimer

As regards deposit taking activity of Bajaj Finance Ltd (BFL), the viewers may refer to the advertisement in the Indian Express (Mumbai Edition) and Loksatta (Pune Edition) furnished in the application form for soliciting public deposits or refer https://www.bajajfinserv.in/fixed-deposit-archives
The company is having a valid Certificate of Registration dated March 5, 1998 issued by the Reserve Bank of India under section 45 IA of the Reserve Bank of India Act, 1934. However, the RBI does not accept any responsibility or guarantee about the present position as to the financial soundness of the company or for the correctness of any of the statements or representations made or opinions expressed by the company and for repayment of deposits/discharge of the liabilities by the company.

For the FD calculator the actual returns may vary slightly if the Fixed Deposit tenure includes a leap year.