Cumulative Fixed Deposit (FD)

Explore the benefits of investing in cumulative fixed deposits, how they function, and how they can help grow your wealth over time.
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Cumulative Fixed Deposit (FD)
OPEN FD
3 mins
28-January-2026

Fixed deposits are among the most preferred investment options for people who value safety, certainty, and predictable returns. Within FDs, cumulative fixed deposits stand out for investors who want their money to grow steadily without periodic payouts.

In a cumulative FD, the interest earned is reinvested and compounded, and the entire amount—principal plus interest—is paid at maturity. This makes it ideal for long-term goals where you don’t need regular income but want maximum value at the end of the tenure.

For investors seeking a secure and disciplined way to grow savings, Bajaj Finance Fixed Deposits offer an added advantage with higher interest rates, strong credit ratings, and flexible tenures.

What is a Cumulative Fixed Deposit?

A cumulative fixed deposit is a type of FD where the interest earned is compounded annually and paid out only at maturity. Unlike non-cumulative FDs, there are no monthly or quarterly interest payouts. Instead, interest gets added back to the principal each year, and future interest is calculated on this increased amount.

This compounding effect helps your investment grow faster over time, making cumulative FDs a preferred choice for long-term savings with guaranteed returns.

With Bajaj Finance Fixed Deposits, investors can choose flexible tenures ranging from short to long term, ensuring their savings align perfectly with future financial goals. Check FD rates.

How to maximise returns with cumulative fixed deposits?

To maximise returns from a cumulative FD, choosing the right financial institution and tenure is crucial.

  • Compare interest rates and safety: Higher rates matter, but so does trust. Bajaj Finance Fixed Deposits are rated AAA-Stable by CRISIL and ICRA, reflecting strong safety and creditworthiness.
  • Choose the right tenure: Longer tenures usually deliver higher maturity values due to compounding.
  • Senior citizen advantage: Senior investors can earn an additional interest rate benefit over the prevailing rate with Bajaj Finance FDs.
  • Plan digitally: Bajaj Finance offers a fully digital FD booking experience along with an online FD calculator to estimate maturity value in advance.

Lock in higher returns of up to 7.30% p.a. today with Bajaj Finance cumulative FDs and let compounding work quietly in the background. Book FD.

Fixed Deposit

  1. Trusted by over 5 lakh customers
  2. Fixed Deposits worth more than Rs. 50,000 crore booked
  3. Rated CRISIL AAA/STABLE and [ICRA]AAA(STABLE)
  4. Up to 0.35% p.a. extra interest offered for senior citizens
  5. Flexible interest payout options available - Monthly, Quarterly, Half-yearly, Annually or at Maturity

By proceeding, you agree to our Terms and Conditions

Difference Between Cumulative and Non-Cumulative FD

The primary difference lies in how interest is paid.

  • In a cumulative FD, interest is compounded and paid only at maturity.
  • In a non-cumulative FD, interest is paid out at regular intervals—monthly, quarterly, half-yearly, or annually.

Non-cumulative FDs are better suited for investors who need a regular income stream, while cumulative FDs work best for long-term wealth creation.

If regular income isn’t a priority, a Bajaj Finance cumulative FD can deliver a higher maturity value. Open an FD account.

So, the question is, where to invest?

Choosing between cumulative and non-cumulative FDs depends on your financial goals and cash-flow needs.

  • If you have a steady income and don’t rely on interest payouts, a cumulative FD helps you build a larger corpus.
  • If you need predictable cash flow, a non-cumulative FD may suit you better.

Cumulative FDs are ideal for salaried individuals, professionals, and business owners planning for future milestones like education, home purchase, or retirement.

With Bajaj Finance Fixed Deposits, you can choose between cumulative and non-cumulative options, flexible tenures, and multiple payout structures—without compromising on safety or returns.

Open a Bajaj Finance FD with as low as Rs. 15,000 today and align your investment with your long-term financial goals.

Fixed deposit variants

Highest Credit Ratings | Trusted with over 1.4 million Deposits | Assured Returns on FD
Recommended

Fixed Deposit - 60 Months

INTEREST RATES UP TO
7.30% p.a.
Invest Online

Fixed Deposit - Senior Citizen

INTEREST RATES UP TO
7.30% p.a.
Invest Online

Fixed Deposit - Age below 60

INTEREST RATES UP TO
6.95% p.a.
Open FD

Fixed Deposit - Minor

INTEREST RATES UP TO
6.95% p.a.
Open FD

Fixed Deposit - HUF

INTEREST RATES UP TO
6.95% p.a.
Open FD

Fixed Deposit - Sole Proprietor

INTEREST RATES UP TO
6.95% p.a.
Open FD

Benefits of Cumulative FDs

  • Higher maturity value: Compounding helps generate more returns over time.
  • Simple and hassle-free: No need to track periodic interest payouts.
  • Ideal for long-term goals: Perfect for planned expenses and future milestones.
  • Encourages financial discipline: Funds stay invested till maturity.

When combined with Bajaj Finance’s higher interest rates and AAA-rated safety, cumulative FDs become a dependable tool for stress-free wealth creation. Invest now!

Conclusion

A cumulative fixed deposit is a smart choice for investors who want guaranteed growth without regular withdrawals. By reinvesting interest and benefiting from compounding, cumulative FDs help you build a meaningful corpus over time.

With Bajaj Finance Fixed Deposits, you get competitive interest rates, strong safety credentials, flexible tenures, and a seamless digital experience—all designed to help your money grow steadily and securely.

Calculate your expected investment returns with the help of our investment calculators

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Provident Fund Calculator

 

Frequently asked questions

Is a cumulative FD better than a non-cumulative FD?

A cumulative FD is better if you don’t need regular income and want a higher maturity amount. Bajaj Finance offers both options so you can choose based on your goals. Book FD.

Who should choose a cumulative fixed deposit over a regular fixed deposit?

Ideal for long-term investors, interest is compounded and paid at maturity, offering higher overall returns.

When it comes to fixed deposits, how is noncumulative interest credited?

Noncumulative interest in fixed deposits is typically credited at regular intervals, such as monthly, quarterly, or annually, depending on the chosen payout frequency. This provides a consistent income stream for investors.

For fixed deposits, how is cumulative interest credited?

Interest in cumulative fixed deposits is compounded and credited at the end of the deposit tenure, along with the principal amount. Investors receive the entire maturity amount in a lump sum.

Who should choose a noncumulative fixed deposit over a cumulative fixed deposit?

Individuals looking for a regular income stream, such as retirees, should opt for noncumulative fixed deposits.

Is cumulative FD taxable?

Yes, the interest earned from a cumulative FD is taxable according to your income tax slab. This tax is applicable to the interest accrued, which is reinvested and paid at maturity.

Is there a distinction between cumulative and noncumulative FD?

Yes, in a cumulative FD, the interest is compounded and paid at maturity along with the principal. In contrast, a noncumulative FD pays interest at regular intervals (monthly, quarterly, etc.) without compounding.

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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.