Sundaram Financial Ltd increases interest rates up to 7.80% on fixed deposits; details here

As per common belief, state-owned bank deposits and fixed deposits in government debt seem to be the most secure of all investment options, but they are also likely to have the lowest returns. But in contrast to a typical bank FD, corporate fixed deposits are debt securities that yield a larger return. Sundaram Financial Ltd., a non-banking finance company, has hiked deposit rates.

The new rates will come into effect from 16 November. Following this initiative, rates on all tenors have been raised. For the past 30 years, the Chennai-based business has held a AAA rating and is regarded as one of the best in this sector.

On non-cumulative deposits maturing in 12 to 24 months, the company raised the interest rate to 7.15 percent annually, 6.93 percent on a monthly basis, and 6.97 percent on a quarterly basis. The corporate body hiked the interest rate on non-cumulative FDs with 36-month maturities to 7.30 percent annually, 7.07 percent monthly, and 7.11 percent quarterly.

For elderly citizens, Sundaram Finance Ltd. upped the annual interest rate to 7.50 percent annually, 7.25 percent monthly , and 7.30 percent on a quarterly basis for non-cumulative deposits maturing in 12 to 24 months. For non-cumulative FDs due in 36 months, the company has raised the interest rate to 7.80 percent annually, 7.53 percent monthly, and 7.58 percent quarterly for elderly people. Non-cumulative FDs offer customers the option of monthly or quarterly interest payments (March, June, September, and December).

Both the interest and the principal on cumulative FDs are paid at maturity. For cumulative deposits maturing in 12 to 24 months, Sundaram Finance Ltd. raised the annual interest rate to 7.15 percent, and for deposits maturing in 36 months, to 7.30 percent. The business raised the annual interest rate on cumulative deposits maturing in 12 to 24 months for senior citizens to 7.50 percent. For deposits maturing in 36 months, senior citizens will get 7.80 percent.

According to economists, investors in fixed income may do well over the coming years because stocks aren’t likely to recover anytime in the near future. In order to reduce inflation, central banks all over the world are hiking interest rates, which can be excellent news for depositors. However, there is no reason why fixed-income returns should rank among the lowest. By taking on more risk, investors can earn larger returns on their FD investments.

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