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What is Fixed Deposit? Everything You Need to Know
- Location: India
A fixed deposit (FD) is a financial instrument offered by banks and financial institutions where you can invest a lump sum for a fixed tenure at a predetermined interest rate. What is fixed deposit? It is a safe and stable investment option that provides guaranteed returns and is ideal for risk-averse investors. The interest rate remains constant throughout the tenure, ensuring predictable earnings. Fixed deposits come with flexible tenure options, and you can choose between cumulative and non-cumulative interest payouts. FD investments are also eligible for tax benefits under certain schemes.
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