The Top Features of the Best FD Plans With High Interest Rates

Fixed deposits are the most favored investment instruments in India. Options galore when you want to invest in a fixed deposit instrument. You can approach three types of financial institutions to open a fixed deposit (FD) account in India. They are – scheduled commercial banks (private, public, and small finance banks), housing finance companies, and non-banking financial companies. Non-banking finance and housing finance FDs are also termed corporate FDs.

Regarding interest rates, housing finance companies like PNB Housing Finance generally offer the best rates, followed by non-banking financial companies and banks. Hence, you may have to look beyond traditional bank deposits to find the best FD plan.

Enlisted below are the top features of the best FD plans with high interest rates:

Cumulative Fixed Deposit

A cumulative fixed deposit keeps your investment amount locked until maturity. Both aggressive and conservative investors prefer cumulative FDs. These deposits are well-suited to fulfill your short and long-term financial obligations or dreams. For example, if you want to buy a car after five years, you can now invest some money in a cumulative fixed deposit, earn interest, and buy conveniently. This can save you from the hassles of applying for a loan. 

Here is a lay down on the best cumulative FD plans:

  • Interest Rate – PNB Housing cumulative FD interest rates range between 5.75% and 6.85% per annum. Also, your actual returns might be higher than the projected interest rate since the interest gets compounded. For example, while PNB Housing’s interest rate for a 10-year FD is 6.85%, the effective yield is 9.40%.
  • Investment Amount – The minimum deposit amount for cumulative fixed deposits is INR 10,000. Hence, you can start investing any time without taxing your pocket and grow your investment wisely.

Non-Cumulative Fixed Deposit

Unlike cumulative fixed deposits, a non-cumulative FD plan is the best for getting regular income. Investors seeking steady income prefer investing in corporate FDs for fulfilling their fixed expenses. For example, you may use the interest amount of a non-cumulative FD to pay tuition fees or loan EMI. PNB Housing FD interest helps in finding the amount required to get the requisite amount and invest sensibly.

Here is a lay down on the best non-cumulative FD plans:

  • Interest Rate – PNB Housing non-cumulative FD interest rates range between 5.60% and 6.85%. The effective rate depends on the interest withdrawal frequency. For instance, while the interest rate of a 5-year non-cumulative FD is 6.64% for the monthly mode, it is 6.68% for the quarterly mode, 6.73% for the half-yearly mode, and 6.85% for the annual mode.
  • Regular Income – The best non-cumulative FD plan offers you four interest options – monthly, quarterly, half-yearly, and annual. Hence, you can choose a period depending on your need and get a regular income.
  • Investment Amount – The investment amount of non-cumulative FDs usually starts from INR 25,000. Hence, you can invest a little and enjoy regular income until maturity.


The best FD plan is the one that helps you grow your capital and get regular income. So, rather than putting all of your investment amount in one fixed deposit instrument, it is better to diversify it into cumulative and non-cumulative FDs. While the cumulative FD returns can help you make big purchases, the returns from a non-cumulative FD can care for your everyday expenses. Check the latest PNB Housing interest rates before investing.

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