We are currently in the final stages of peak interest rates. The RBI maintained the status quo for the 10th time in a row, but a shift in its policy stance from withdrawing easing to neutrality could perhaps foreshadow a rate cut at the next meeting. And the clock is ticking to secure these high interest rates before they start to fall to attract the attention of investors looking for stable, fixed income.
In this context, the long-term deposits offered by Sundaram Home Finance provide a compelling investment case for investors looking for fixed returns and security.
Rated AAA (highest) with stable outlook by CRISIL since January 2023 and by ICRA since June 2022, Sundaram Home Finance fixed deposits are among the safest deposits in the market.
Sundaram Home Finance operates the housing finance sector. In FY24, the company expanded its real estate backed lending and added small business loans and affordable home loans to its offering, especially for Tier 3 and Tier 4 cities.
FD scheme
Sundaram Home Finance offers fixed deposits under two schemes: Cumulative Deposit Scheme (CDS) and Recurring Deposit Scheme (RDS).
CDSs are compounded annually and paid at maturity, whereas RDSs calculate interest until the end of the term and pay interest periodically. Therefore, while CDS have naturally higher yields and are suitable for individuals who want to save and grow their corpus, RDS still outperforms regular savings accounts and is useful for pensioners and those looking for regular payments while protecting their corpus. Suitable for elderly people.
CDS offers seniors 7.95 per cent for a tenure of 12 months and 8.25 per cent for a tenure of 24 to 60 months, while others range from 7.45 to 7.9 per cent. will be done.
The RDS scheme offers monthly payment options for tenures starting from 36 months, while quarterly payment options are available for all tenures. However, the interest rate on monthly payments is relatively lower compared to quarterly payments. Under this scheme, senior citizens will be paid up to 7.95/8.01% monthly/quarterly, while for others it will be 7.63/7.68%.
The minimum deposit amount is ₹10,000, after which it will be in multiples of ₹1,000. Depositors can also take advantage of the ‘auto-renewal feature’ where the deposit is automatically renewed for the same period at the interest rate on the maturity date. TDS is applicable on interest payments above ₹5,000. To open a savings account with Sundaram Home Finance, you will need your PAN and Aadhaar.
The scheme has a lock-in period of 3 months and early withdrawals can only be made after 3 months from the deposit/renewal date. And in case of such premature withdrawal, the interest paid will not be at the promised level, but at a lower rate.
How to apply
Sundaram Home Finance has not extended the option to apply online. Therefore, prospective depositors should fill out the application form available online and visit the nearest branch to open a deposit with the company.
our view
Among other AAA rated fixed deposits in the market, Mahindra Finance offers the highest interest rate of 8.05% for 42 months on cumulative deposits for non-seniors. The highest interest rate offered by ICICI Home Finance in this sector is 7.65% for a tenure of 36-60 months, while Sundaram Finance and LIC Housing Finance offer 7.75% for a tenure of 24-36 months and 3-5 years respectively. .
bl.portfolio covers a range of stable income products across banks, small finance banks, non-bank financial institutions and building finance companies, with the aim of providing choice and not putting all your eggs in one basket. This is what we recommend.
Investors seeking diversification may consider investing a portion of their debt allocation in this product, preferably for the long term, preferably in an accumulative deposit scheme to secure relatively high interest rates and earn stable and secure returns. Masu.
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Published October 13, 2024