Banking sector digitalisation has made financial and investment planning easier for banks and customers. Banks have been able to offer personalised financial advice and plan to their customers with varying needs. Fixed deposit investments have turned schemes more attractive and accessible for investors of all ages and natures post the digital shift.
Digital fixed deposits offer an array of perks and benefits, earning them a popular spot in many investors’ portfolios. As new investors opt for fixed deposits and current FD holders plan for reinvestment, digital procedures can be the answer for advanced and more advantageous investments. Read on to learn more about the top reasons for opening an online fixed deposit account.
5 Key Reasons to Opt for a Digital Fixed Deposit Account
More and more investors have been leaning towards digital FD account opening and management. Here are the top 5 reasons behind the shift.
Quick and Hassle-Free Account Opening
The traditional fixed deposit investment method included bank branch visits, physical transfer of documentation, and so on. It is time and effort-consuming for both investors and bank or NBFC representatives. On the contrary, the digital account-opening procedure enables investors to open accounts from anywhere at any time. It is highly agreeable, especially for those with a busy schedule or those living in a remote area.
The entire process of visiting the bank’s online site, finalising the details, and opening the account can be completed from one’s mobile device or laptop. The procedure can take less than 10 minutes for certain banks. The initial research process also becomes easier. Investors can compare all available FD schemes and take their time to decide without being rushed by any provider.
Competitive Interest Rates
In selective cases, some banks offer higher interest rates on online fixed deposit investments than offline. The aim is to encourage digital transactions.
No Requirement of Savings Account
Holding a savings account to open an FD account is compulsory at many banks. The rule has been relaxed for digital banking. Selected banks and NBFCs have started allowing online fixed deposit account opening even without enforcing the need for any existing savings account. This concession motivates the idea of easier access and convenience for investors.
Note that investors with no holding account at the bank will have to complete their KYC and present the required documents. Digital KYC and document upload features will remove any inconvenience.
Same Perks of FDs with More Convenience
An online fixed deposit offers the same benefits as a standard offline FD, such as:
Assured high interest rates
Low investment risk from market fluctuations
Steady capital appreciation
Flexible tenure ranging between a week and 10 years
Good liquidity with premature withdrawal option
Regular payout ensuring fixed income source
Auto-renewal for effortless reinvestment
Higher FD interest rates for women and senior citizen investors
Insurance coverage on up to Rs. 5 lakhs under the DICGC scheme
Saving on taxes under section 80C of 1961’s IIT Act
The ease of investment and all the advantages of a fixed deposit account make digital FD a better option. Moreover, all the perks, details, and conditions are on the screen, ensuring complete transparency. It eliminates the need to frequently contact the bank or NBFC for clarification.
Seamless Investment Planning
Various online tools are available to make online FD investments a cakewalk, even for inexperienced investors. For example, online FD calculators will help investors compute the returns of different investment plans, compare them, and pick the best plan within a few minutes. Managing the count and investment takes less time and effort.
Process of Opening a Digital Fixed Deposit Account
Certain procedures and requirements can vary based on the bank or NBFC. However, online fixed deposit investment can be completed in the few following steps.
Pick an FD: Research the available FDs, the highest interest rates, and other important features. Select one that resonates the best with the respective fixed deposit investment goals.
Visit the Online Banking Site: Land on the official net banking site of the selected FD provider.
Register: New customers must register on the site. If needed, provide the required information and complete KYC and any other verification. Existing customers can proceed with the next step.
Select the FD: Navigate to the investment section and click on FD. Pick the best plan from different cumulative and non-cumulative FDs.
Complete Documentation: Fill out the forms and upload the required documents.
Finalise the Investment: Ensure you pick the tenure, amount, payout, and other details. Transfer the amount and wait for the confirmation. Download and print the receipt for future reference.
Final Thoughts!
Over the last few years, particularly in the post-pandemic era, digital banking has served individuals with a noticeable convenience. Assisted by the latest information and the right online tools, investors can plan their finances in a more advanced manner. The advantages of a fixed deposit account are that it is easier to access online in the presence of some added benefits.
