Pune (Maharashtra) [India], Mar 3 (ANI/BusinessWire India): In the latest bi-monthly Monetary Policy Committee meeting in February 2020, the RBI maintained the accommodative economic stance and left the repo rate and reverse repo rate untouched at 5.15 per cent and 4.90 per cent respectively.
However, in an attempt to support growth and revive the underwhelming economy, the RBI also announced the introduction of Long-Term Repo Operations (LTROs). Through LTROs, the RBI assures banks access to durable liquidity, at a reasonable rate.
However, as well-received as the move is, financial experts also suggested, in the wake of the announcement, that the initiative would play a hand in the fall of bank deposit rates.
In fact, since the MPC meetings, FD rates have been slashed to as low as 5.50 per cent, even as the consumer price inflation for January 2020 sits at 7.59 per cent, up by 2.97 per cent since October 2019. Coupled with the possibility of a repo rate cut in June 2020, the current policies are exerting downward pressure on FD interest rates.
Nonetheless, as an FD is a must-have in your portfolio due to its guaranteed returns, you can sidestep the issue of diminished yields by investing in a company deposit like the Bajaj Finance Fixed Deposit. Even through the market volatility, Bajaj Finance Limited has maintained industry-leading rates and is still among the most stable options to go with.
For a better understanding of why to invest in a Bajaj Finance FD as bank rates fall, read on.
Offers you a safe instrument, immune to market volatility
With the repo rate on a downward trend through 2019 and the economy faltering, it can be well worth identifying reliable instruments. The Bajaj Finance FD, for instance, is reliable, promising assured fixed returns once the FD is booked.
Its immunity to market volatility, coupled with ICRA's MAAA and CRISIL's FAAA ratings, means that you can invest a large sum without fear of default. The FD has stood its ground even as other AAA-rated papers witnessed defaults and getting in now, before the rates drop, allows you to secure a high rate and a stable environment.
Grants access to interest rates that combat inflation
As per the above-mentioned consumer price inflation rates, it is evident that instruments that offer yields at a rate below seven per cent could have you staring at negative returns. Thankfully, Bajaj Finance offers FD interest rates up to 8.10 per cent for regular customers and up to 8.35 per cent for senior citizens. With these rates and the RBI's revised CPI inflation projection of 3.2 per cent for Q3 of 2020-21, you could be looking at serious profits in the first year itself.
To help you visualise what your potential earnings could be, consider the following example.
The above-mentioned results were calculated with the help of the FD calculator.
Gives senior citizens a lucrative mode of investing
A decline in FD interest rates affects senior citizens doubly as this instrument is among the few that are widely used for wealth generation post-retirement. However, with a Bajaj Finance FD, senior citizens get an additional 0.25 per cent on the base interest rate and with intelligent investing, you can fund all your expenses effortlessly. Further, due to the generous rate, investors can also opt for frequent interest payouts and earn enough on their investment to handle monthly spends comfortably.
Allows cautious investors to earn via monthly contributions
With the ever-changing landscape of the financial market, you may be reluctant to park a lump sum in fear of negative returns down the line. However, with the Systematic Deposit Plan feature, you can make bite-size monthly investments as low as Rs 5,000 and take advantage of the prevailing interest rates, every time you deposit. This way, you benefit from the current rates, should you invest now, and you don't miss out on future hikes, should they happen.
To earn well even as bank interest rates fall, all you need to do is visit the Bajaj Finance Online FD page and requesting a call.
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