 Pallavi Mulay, ET Bureau
Corporate FD is not new, but it was neglected for a long time. However, liquidity crunch in the past couple of years and turmoil in equity market made companies to revisit this option. Number of reputed companies like Tata Motors, HDFC, ICICI Home Finance, Godrej Industries, EXIM and HUDCO are now aggressively seeking deposits from public. They are very much similar to a bank fixed deposit.
The difference: one is parking his money with a company instead with the bank for a fixed duration and in return the company will offer interest at a predetermined rate on the amount deposited. Like banks, the tenure ranges from 1-7 years. But it is preferable to have corporate FD for short term like 1-3 years. It helps the investor to switch to other company if it requires. Premature withdrawal is also permitted at the company's discretion but it involves some cost.
Check out the deposit rates offered by companies | State Bank of India |  Tenure: Less than 2 years
Cumulative: 6.25
Non Cumulative: 6.25
Miminmum Amount: Not Mentioned
Rating: NA
Tenure: Less than 3 years
Cumulative: 7
Non Cumulative: 7
Miminmum Amount: Not Mentioned
Rating: NA | HDFC Regular |  Tenure: 12-23 months
Cumulative: 6.90
Non Cumulative: 6.65
Miminmum Amount: 20,000
Rating: AAA
Tenure: 24-35 months
Cumulative: 7.40
Non Cumulative: 7.15
Miminmum Amount: 20,000
| | HDFC Premium |  Tenure: 15 months
Cumulative: 7.00
Non Cumulative: 6.75
Miminmum Amount: 20,000
Tenure: 30 months
Cumulative: 7.75
Non Cumulative: 7.50
Miminmum Amount: 20,000
| | Tata Motors Ltd |  Tenure: 2 years
Cumulative: 8.00
Non Cumulative: 8.00
Miminmum Amount: 20,000
Rating: NA
Tenure: 3 years
Cumulative: 8.75
Non Cumulative: 8.75
Miminmum Amount: 20,000
| | Mahindra Finance Ltd |  Tenure: 12 months
Cumulative: 8.00
Non Cumulative: 7.75
Miminmum Amount: 10,000**
Rating: FAA
Tenure: 18 months
Cumulative: 8.25
Non Cumulative: NA
Miminmum Amount: 10,000**
Tenure: 24 months
Cumulative: 8.50
Non Cumulative: 8.25
Miminmum Amount: 10,000**
Tenure: 36 months
Cumulative: 9.00
Non Cumulative: 8.75
Miminmum Amount: 10,000** | LIC Housing Finance Ltd |  Tenure: 1 years
Cumulative: 6.75
Non Cumulative: 6.75
Miminmum Amount: 10,000
Rating: FAAA
Tenure: 18 months
Cumulative: 6.80
Non Cumulative: 6.80
Miminmum Amount: 10,000
Tenure: 2 years
Cumulative: 7.25
Non Cumulative: 7.25
Miminmum Amount: 10,000
Tenure: 3 years
Cumulative: 7.50
Non Cumulative: 7.50
Miminmum Amount: 10,000
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