Fixed deposits continue to be a popular choice for conservative investors in India, offering steady returns with low risk. Among the various institutions offering fixed deposit (FD) schemes, Shriram Finance stands out due to its attractive interest rates and flexible tenures. Whether you are a senior citizen, a salaried employee, or someone looking to diversify your investment portfolio, understanding the Shriram Finance FD rates can help you make informed financial decisions. Their FD products cater to a wide range of customers by combining safety, reasonable returns, and ease of investment.
Overview of Shriram Finance Fixed Deposits
Company Profile
Shriram Finance is one of India’s leading non-banking financial companies (NBFCs), known for its strong presence in the retail finance segment. The company provides fixed deposit schemes that are highly rated by credit agencies, reflecting their relative safety and reliability. Investors often choose Shriram Finance FDs due to the company’s trusted reputation and its consistent track record of meeting financial obligations.
Why Choose Shriram Finance FDs?
There are several reasons why Shriram Finance fixed deposits are preferred by many:
- Attractive FD interest rates compared to banks
- Flexible tenure options ranging from 12 months to 60 months
- Additional interest rates for senior citizens
- Monthly, quarterly, half-yearly, or yearly interest payout options
- Safe investment option with credit ratings from CRISIL and ICRA
Latest Shriram Finance FD Rates
Interest Rates for Regular Investors
The interest rates offered by Shriram Finance on its FDs vary based on the tenure and whether the deposit is cumulative or non-cumulative. Below is a general breakdown (subject to change over time):
- 12 months: Around 7.25% per annum
- 24 months: Around 7.75% per annum
- 36 months: Around 8.05% per annum
- 48 months: Around 8.15% per annum
- 60 months: Around 8.25% per annum
Cumulative deposits will receive interest at maturity, while non-cumulative deposits allow periodic interest payouts.
Senior Citizen FD Rates
Senior citizens enjoy an additional 0.50% interest across all tenures. This makes Shriram Finance one of the more attractive options for retirees who are looking for safe, higher-yielding investments.
- 12 months: Around 7.75% per annum
- 24 months: Around 8.25% per annum
- 36 months: Around 8.55% per annum
- 48 months: Around 8.65% per annum
- 60 months: Around 8.75% per annum
This enhanced return is particularly useful for pensioners who rely on regular interest income to meet day-to-day expenses.
Cumulative vs Non-Cumulative FDs
Shriram Finance offers both cumulative and non-cumulative FD schemes, and choosing the right one depends on your financial goals.
- Cumulative FD: Interest is compounded annually and paid at the end of the maturity period. Ideal for long-term wealth creation.
- Non-Cumulative FD: Interest is paid out at regular intervals (monthly, quarterly, half-yearly, or annually). Suitable for those needing regular income.
Eligibility and Documentation
Who Can Invest?
The following entities are eligible to invest in Shriram Finance FDs:
- Resident individuals
- Hindu Undivided Families (HUFs)
- Companies and partnership firms
- Trusts and associations
Required Documents
To open a fixed deposit account with Shriram Finance, investors must submit the following documents:
- Proof of identity (Aadhaar card, PAN card, Passport, etc.)
- Proof of address (utility bill, rent agreement, passport, etc.)
- Recent passport-sized photograph
- PAN card is mandatory for investments above a certain limit
Taxation on FD Interest
Tax Deducted at Source (TDS)
Like other FDs, the interest earned on Shriram Finance FDs is taxable. If the total interest earned in a financial year exceeds the threshold limit set by the Income Tax Act, TDS will be deducted. The current threshold for TDS is Rs. 5,000 for NBFCs. Investors can submit Form 15G or 15H (for senior citizens) to avoid TDS if their income falls below the taxable limit.
Tax Filing Requirement
Even if no TDS is deducted, interest income must be reported while filing your income tax return. It will be added under the head Income from Other Sources.
Premature Withdrawal Policy
Terms and Conditions
While Shriram Finance does allow premature withdrawal of fixed deposits, certain penalties may apply. Generally, if you withdraw the FD before completing 12 months, no interest is paid. For early withdrawals beyond one year, a reduced interest rate is applicable.
Loan Against FD
Instead of breaking your FD, Shriram Finance also allows you to take a loan against it. Investors can avail up to 75% of the deposit amount as a loan, with interest rates slightly higher than the FD rate. This is a better alternative if you need short-term liquidity without losing your accrued interest.
How to Open a Shriram Finance FD
Online Process
Shriram Finance has simplified the process by offering online FD booking through their website or mobile application. The steps typically include:
- Register with your mobile number and email
- Select FD type, tenure, and amount
- Upload KYC documents
- Make the payment through net banking or UPI
Offline Process
You can also visit a nearby Shriram Finance branch to open an FD by filling out a form and submitting necessary documents with a cheque or demand draft.
Risks and Safety Considerations
Credit Rating
Shriram Finance FDs are rated as high safety by leading agencies like CRISIL and ICRA. This rating reflects a low risk of default and adds to the trustworthiness of the product. However, since FDs in NBFCs are not covered under the Deposit Insurance and Credit Guarantee Corporation (DICGC), it’s wise to diversify investments and not exceed high-value limits in a single institution.
Compare Before You Invest
Although Shriram Finance FD rates are quite competitive, it’s a good idea to compare them with other NBFCs and banks. Look at factors like credit rating, flexibility, penalties, and additional benefits for senior citizens before deciding.
Shriram Finance FD rates make them a strong contender in the fixed deposit market, especially for investors looking for better returns than traditional bank FDs. With flexible payout options, higher rates for senior citizens, and a reliable track record, these FDs offer a blend of security and profitability. Whether you are saving for a short-term goal or planning for retirement, a fixed deposit with Shriram Finance can be a smart addition to your investment strategy. As always, evaluate your financial goals, tax implications, and liquidity needs before locking in your funds.