Know More About the Suitable Fixed Deposits Scheme in 2020

The Reserve Bank of India reduced the repo rate by 125 points in five installments during FY 2019-2020. Such reduction is expected to lower the interest rates available on fixed deposits and other savings schemes offered by financial institutions and NBFCs.

However, the scale of reduction expected by RBI has not yet materialized. Leading financial institutions are yet to reduce their interest rates by such margin. The delay in the reduction of interest rates has been mainly due to the disparity between monetary demand and supply. Owing to such situations, fixed deposits still hold a considerable 57% share in the deposit market. 

The repo rate reductions have been a direct result of the Indian economic slump caused largely by the global economic turmoil. As such, financial planners consider the best move for individuals should be to invest in fixed deposits for a longer period before interest rates go down any further in the coming fiscal years. 

It would allow investors to wait out the economic turmoil while earning assured returns. 

There are several factors which individuals should consider - 

• Minimum deposit amount.

• Stability and credibility of the financial institution. 

• Multiple deposit facility.

• Interest rates. 

After duly considering these factors, individuals should decide which fixed deposit scheme to invest in going in 2020. They should also take into account the interest amounts earned from various tenors using an online FD calculator before finalizing on the investment.

Also, Read This: Why Do You Need To Keep Updated With Your PF Fund Balance