Investing in Corporate FDs: Tips for Maximising Your Returns

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Fixed Deposits (FDs) are a popular investment option for investors looking to earn stable returns. These FDs are gaining popularity due to their higher interest rates and ICICI Bank’s Corporate FDs are ideal for securing fixed and guaranteed returns. The interest payment is evaluated either quarterly, monthly, or on maturity. If you are considering investing in Corporate FDs, here are some tips to maximise your returns.

Understanding Corporate FDs

Before talking about tips, let us understand what Corporate FDs are. Corporate FDs are financial tools that offer a fixed rate of returns on investments made by corporate companies. The interest rates offered by Corporate FDs are typically competitive and come with different tenures ranging from 7 days to up to 10 years, allowing you to choose a flexible tenure for your investment needs. Some FDs also offer the option of premature withdrawal, subject to terms and conditions.

Let's now discuss the tips that can help you to maximise your returns.

Opt for a Longer Lock-in Period to Get Higher Interest Rates

One of the main advantages of opting for a corporate FD with ICICI Bank is our competitive interest rates. The interest rates on Corporate FDs are competitive depending on the tenure, so the longer the lock-in period, the higher the interest rate. ‌

So if you want the maximum returns, opting for a more extended lock-in period is best. For this, you can opt for our Non-Callable FD. This will help you earn higher returns over the long term.

For instance, if you invest in a corporate FD for 90 days, you stand to earn a 6% interest, but if you extend that to 120 days, you get 6.50%, take that to one year and if you take it up to just over a year, the interest rate will be 7.25%.

Use Callable FD Option for Quick Access to Invested Funds

ICICI Bank offers Callable Fixed Deposits (FDs), these deposits allow depositors to make premature withdrawals when needed. ICICI Bank’s Callable FDs provide flexibility to investors as they can choose the tenure of their investment per their requirements. With Callable FDs, the tenure can range from 7 days to up to 10 years, providing flexibility to investors.

Callable FDs offer liquidity to investors as they can withdraw their deposits before the maturity date, subject to terms and conditions. This makes them a suitable investment option to save on unexpected financial liabilities.

Consider Reinvesting the Interest Earned

Another way to maximise your returns on Corporate FDs is to reinvest the interest earned.ICICI Bank offers Corporate FDs with an option of reinvesting the interest earned. When you reinvest the interest, it gets added to your principal amount, and you earn interest on the new amount.

Reinvesting the interest can help you earn compound interest, significantly increasing your returns. If you don't need the interest payouts immediately, consider reinvesting them to maximise your returns. ‌

We make reinvesting the interest easy and hassle-free for our interested customers. You can choose the option when opening the FD or at the time of the interest payouts.

ICICI Bank also offers an auto-renew option, so you don't have to worry about renewing your FDs when they mature. Please note that your FD will not continue with the same interest rate as before, nor the principal amount. The applicable rate on the day of renewal will apply. This feature ensures you are well positioned to know exactly how much you’ll earn over the next term with compounding interest.

Diversify Your Investment Portfolio

Diversification is key to managing risk in any investment portfolio. It's essential to spread your investments across different asset classes and issuers to minimise the risk of losing the invested money.

When investing in ICICI Bank Corporate FDs, diversifying portfolios is easy. This way, your company's money will earn a fixed return rate. So while investing in other asset classes, such as equities, mutual funds, or lucrative debt funds, you can further diversify your portfolio with Corporate FDs to your list.

Conclusion

Corporate FDs are an excellent option for investors looking for stable and higher returns. To maximise your returns, opt for a more extended lock-in period, consider reinvesting the interest earned, and diversify your investment portfolio. Investing in Corporate FDs can be a valuable addition to your investment portfolio, but make sure you invest wisely and with a long-term perspective.

Please note that Credit facilities are not available for Non-callable Deposits (Non-Withdrawable).

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