What is Corporate FD?
Corporate FD is a financial product offered by non-banking financial institutions, housing finance companies, and other corporate entities. It is a type of fixed-income investment where investors deposit a lump sum of money with the corporate entity for a fixed tenure in exchange for a predetermined interest rate. Corporate FDs are similar in concept to traditional bank fixed deposits, but they are not offered by banks.
Here are some key features and characteristics of Corporate Fixed Deposits:
Interest Rates: The interest rates offered on corporate FDs can vary from one issuer to another and may be higher than those offered by banks for regular fixed deposits. The interest rates are fixed for the entire tenure of the deposit.
Tenure: Investors can choose the tenure for their corporate FD, which can range from a few months to several years. The fixed deposit matures at the end of the chosen tenure.