Post office
The Reserve Bank of India (RBI) has cut the repo rate for the second consecutive time. After this, many banks including Punjab National Bank, Yes Bank, Canara Bank, Kotak Mahindra Bank, Equitas and Shivalik Small Finance Bank have reduced interest on FDs. That is, now FD investors will get less returns. If you are also thinking of getting FD and are worried about getting a low interest rate, then you can choose the option of Time Deposit (TD) Saving Scheme of the post office. You will get more returns by investing in the post office TD. Let us know how the FD has become better than FD after cuts in interest rates.
Where how much interest is getting
The post office is currently getting interest at a rate of 7.5% on 5 years TD. At the same time, banks are paying interest at the rate of 6.5% to 7.1% on FDs of this period. Not only this, there is only up to Rs 5 lakh insurance in bank FD. That is, if the bank sinks, then only up to 5 lakhs will be safe. At the same time, the post office TD is completely safe by the government. Along with this, TDS does not deduct it, which gives you full payment of interest.
Best for what kind of business
If your priority is safe investment + fixed return, then the post office TD is better than the bank FD. On the other hand, if you want some flexibility and facility, then banks can choose FD. However, here you will get less returns. So if you want more returns with safe investment, then choose the post office TD. You can easily invest in post office TD. One thing to keep in mind that TD is still a large extent manual process, but now it is improving through India Post Payments Bank.
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