The Alternative to the Bank Fixed Deposit

The Alternative to the Bank Fixed Deposit

The recent drop in interest rates has left many of us fuming. The Bank Fixed Deposits currently are offering anywhere between 7 to 7.5% – almost a percent point lower than a year ago. The news is there more rate cut coming.

The inflation and the income tax further ensure that the final real value in your hands is negative.

The question thus everyone is asking is “what is the alternative to the Bank FD”?

fixed deposits

Low interest rate on Fixed deposits.

It becomes imperative to search for an investment that will not only provide the safety similar to fixed deposits but also help you protect the purchasing power of your money from taxes and inflation.

Usually the options that you would consider include a PPF, Post Office Deposits, National Savings Certificates, etc. They are safe and provide a fixed rate of return/interest.

low interest rate savings

A crack in the Nest. Reducing interest rate on PPF, NSS

But each one of them has their limitations.

Let us consider today and learn about a unique investment that you may not have considered so far.

This opportunity is to lend money at a fixed rate of interest.

Peer to peer lending platforms such as bring to you the opportunity to lend your money and earn interest as high as 18% to 20% per year.

That’s almost double than what a fixed deposit can get you.

Sounds risky?
You have read that high returns come at a higher risk. Isn’t it? Why would someone be willing to pay so much?

Let’s understand this in a little detail.

Peer to peer lending works like a community

Have you ever given loan to a friend when he was in need and who returned it later? (Of course, you do not charge interest to a friend!),

Your answer would most likely be “yes”. Great!

In peer to peer lending too, you are lending your money to other people. These people may not be your friends though.

The question that arises is how do you ensure that your money is repaid.

To understand that, let’s first understand how the borrowers are selected.

Who are the borrowers? 

The platform of i2i has, through strict filtration criteria, made a list of people who need money for their various needs. These borrowers include individuals and businesses.

  • The filtration criteria include detailed information of the borrower with physical verification and assessment of credit reports.
  • The money that you lend is further governed by a duly stamped legal agreement signed by the borrower as well as the lender.
  • Regular follow-ups and reminders are sent to the borrower to repay the installments in time.

With this process in place, so far there have been zero repayment defaults.

So you see, your money is as safe as it can be.

Why are these borrowers willing to pay a high rate of interest?

Unfortunately, these borrowers do not get loans easily through the normal banking system. It doesn’t mean that they do not have the capability to repay. The real reason is that they do not pass the minimum borrowing criteria set by banks and may be considered high risk.

Take for example, a small business. The business needs money immediately to fulfill an order that it has received. It goes to the bank but the bank, for various reasons, rejects the application.

What’s the option for the businessman? It is to go for an alternative like peer to peer lending.

Does it make sense now? 

Yes. Great. Go ahead and sign up here. Make an investment of Rs. 5,000 only to begin with. Experience for yourself.

No. Doesn’t make sense still? Not to worry.

Sign up for this blog to know more and educate yourself about this unique form of investment. or just speak to us; we’re just a call away.

Minimum Risk, Maximum Returns


  • Very good post. However, you can also go for Liquid fund. Liquid fund returns in the last three years, have been quite impressive with the average return of 8.9 per cent on an annualized basis. But going forward market liquidity could decide rates.After recent dividend distribution tax changes, it makes sense to go in for the growth option in liquid funds if you are in the 10 and 20 per cent tax slabs. Go for Daily Dividend Reinvest option if you fall in 30% tax slab. Highest return compared to fixed deposits. It would range between 4% to 8% per annum.

  • This is a topic that’s close to my heart… Take care!

    Where are your contact details though?

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