6.98% KTDFC Fixed Deposit Scheme in 2021 – Should you invest?

KTDFC-Fixed-Deposit-FD-Scheme-2021-ReviewKTDFC Fixed Deposit Scheme Review

Banks and financial institutions are reducing fixed deposit interest rates. Kerala Transport Development Finance Corporation (KTDFC) FD offers good interest rates up to 6.25% and one can can get yield up to 6.98%. These FD’s are guaranteed by the Government of Kerala, hence are considered as one of the safe FD schemes. What are the features of KTDFC FD Scheme? What are the interest rates of KTDFC Fixed Deposit Scheme? Should you invest in KTDFC Fixed Deposit or avoid?

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About KTDFC Limited

Kerala Transport Development Finance Corporation Limited (KTDFC) was registered under the Companies Act in 1991 and started commercial business in 1992. The Corporation is a NBFC registered under the Reserve Bank of India under the category Non Deposit-Systemically Important.

The main objects are financing of transport vehicles, workshops and machinery, financial arrangements for acquisition of transport vehicles and machinery, assist transport or other undertakings, agencies, firms, whether incorporated or not, situated within the State of Kerala, with long, medium or short terms loans for any purpose whatsoever or subscribe to their share capital, equity or preference debentures or assist in other ways within the restrictions imposed by Reserve Bank of India from time to time. In addition to its usual lending schemes to KSRTC and others, the company widened its scope of activities by undertaking BOT/BOOT projects for KSRTC and Government departments. 100% of the share capital is held by Government of Kerala.

 KTDFC Fixed Deposit Scheme Details

1) KTDFC FD’s comes with 1 year to 5 years tenure.

2) This FD scheme, offer cumulative and non cumulative options. In cumulative option, the interest would be paid on maturity. In non cumulative option, interest would be paid monthly or quarterly based on the option chosen.

3) You can deposit a minimum of Rs 10,000 and in multiples of Rs 1,000 in this FD scheme.

4) Interest rates are ranging between 5.75% to 6% for general category.

5) Senior Citizens would get 0.25% higher interest rates. The yield works out to be up to 6.98% for a 5 year cumulative FD Scheme.

6) These interest rates are effective from 1st January, 2021.

What are various FD Schemes offered by KTDFC?

It offers below FD schemes:

1) Periodic Interest Scheme – Monthly (PIS-M):  This is non-cumulative FD scheme where the interest would be paid monthly. On the maturity, you would get your principal back.

2) Periodic Interest Scheme – Quarterly (PIS-Q): This is non-cumulative FD scheme where the interest would be paid quarterly. On the maturity, you would get your principal back.

3) Money Multiplier Scheme (MMS): This is a cumulative FD scheme where the interest would be compounded monthly and paid on maturity.

Interest Rates on KTDFC Fixed Deposits in 2021

Here are the latest interest rates which are effective from Jan, 2021 onwards. Senior Citizens would get 0.25% extra interest rates. Refer second table for that.

KTDFC FD rates 2021 - General category

KTDFC FD rates 2021 - Senior Citizens Category

Who is eligible to open a KTDFC Fixed Deposit?

The following are eligible to open this FD.

1) Resident Individuals

2) Hindu Undivided Family (HUF)

3) Trust

4) Government firm

5) Private Firms

6) Societies

How to invest in KTDFC FD Online?

Generally, all the fixed deposits these days can be opened online. However KTDFC FD Scheme online facility is not available.

How to Open KTDFC Fixed Deposit then?

Below is the step-by-step process to open FD scheme with KTDFC.

1) Download the FD application form from KTDFC website here

2) Fill the applicable form and paste the photograph. No thumb impression allowed.

3) Duly filled application form along with Crossed Cheque or DD may be forwarded to Registered office/Branch offices of the KTDFC address. UTR Number/Pay in slip to be attached as proof of deposit if the amount is already deposited in a KTDFC bank account through RTGS or NEFT or Cheque.

4) All Cheques/Demand Drafts must be crossed and made payable to Kerala Transport Development Finance Corporation Limited, payable at Thiruvananthapuram or the places where the branches of the Corporation are situated.

What documents are required to open KTDFC Fixed Deposit Scheme?

You need to submit Photo + PAN + Address proof documents. Below are the some of the address proof documents that can be submitted.

1) Aadhaar Card

2) Valid passport

3) Valid driving license

4) Voter’s ID card

5) Telephone bill

6) Bank statement

7) Electricity bill

8) Ration card

9) Letter from employer

You can refer KTDFC website for a complete list of documents.

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Why to invest in this FD scheme?

Here are some positive factors.

1) KTDFC is a Kerala Government owned entity and safe to invest in their FDs.

2) You can invest in this FD scheme with a minimum of Rs 10,000 and get higher interest rates up to 6% for regular investors and up to 6.25% for Senior Citizens and get high yield up to 6.98%.

3) You can enjoy FD options of cumulative FD, monthly interest FD or Quarterly FD interest FD.

Why NOT to invest in this FD scheme?

Here are some negative points.

1) KTDFC FD schemes are considered as safe as these are guaranteed by the Government of Kerala. However, they have fixed a threshold limit of Rs 4,500 Crores for such guarantee. No one knows whether KTDFC is offering these FDs only to this limit or whether it is exceeding this limit. If they are exceeding the limits, the FDs accepted higher than the guaranteed value could become risk.

2) Premature withdrawal rules make it unattractive.

3) One has to invest in these FDs through manual process / offline. This is a tedious process.

Some of the FAQs about this FD Scheme

1) How can I calculate the interest amount?

You can visit KTDFC Interest Rates Page where you would know the interest rates based on specific tenure which is updated regularly.

2) What is the KTDFC Fixed Deposit Rating?

If you are thinking “is KTDFC safe for FD”, you need to know that this is 100% Kerala government owned company. There are no credit ratings available on the website. However, since it is owned by Kerala Government, one can consider this as safe FD to the extent of Rs 4,500 Crores guaranteed by them.

3) How the Interest received on these FDs is taxed?

KTDFC would deduct TDS on interest exceeding Rs 5,000 per annum like any other company. However, one need to calculate total interest received and pay income tax based on the income tax slab applicable to them in that year.

4) Can I take a premature withdrawal of my FD?

One can take a premature withdrawal only after 3 months from the date of KTDFC FD or from the renewal of deposit. If you wish to break the FD between 3 to 6 months after opening FD, no interest would be paid. If you wish to break FD after 6 months of opening FD but before the maturity date, you would get 2% lower rate compared to the interest rate at which you invested earlier.

5) When the interest payment would be done for non cumulative deposits?

In case of non cumulative deposits, interest would be paid on the 1st day after closure of month or quarter based on the scheme and option chosen.

6) Can we submit Form-15G or Form-15H?

Yes. Individuals can submit a form 15G or 15H to KTDFC to not to deduct TDS on their FD interest.

7) In an emergency, can I get a loan against my FD?

Yes, but after 3 months from the date of opening FD which would be at the discretion of the company. One can request for the loan on this FD which would be up to 75% of the FD amount. The interest rate would be 2% higher than the FD interest rate on such loan.

8) Can NRI’s invest in this FD Scheme?

No. NRI’s cannot invest in this Fixed Deposit Scheme.

9) If I am an existing customer of KTDFC, would I get any extra interest?

No. They would not get any extra FD interest.

10) What are the KTDFC Fixed Deposit toll free number or customer care details?

You can reach at any of the following details for queries or complaints.

i) You can leave a request at http://ktdfc.kerala.gov.in/contact-us and they would contact you.

ii) You can write to them at their registered office mail ID: mail@ktdfc.com

iii) You can reach them at their registered office contact nos Ph: 0471-2327881, 882, 883.

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Should you invest in KTDFC Fixed Deposit Schemes in 2021?

KTDFC is 100% owned by the Kerala Government. Its FDs are safe to invest to extent of threshold guaranteed by Govt of Kerala. It offers highest interest rates where yield comes up to 6.98%. While interest rates are okay, the entire process is manual and offline. If you are willing to take this pain you can invest in this FD scheme. Alternatively, you can look at TNPFC FD Scheme that is offering high interest rate upto 10.46% yield.

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Suresh KP


  • Nidheesh o

    can you please tell me where are the branches of KTDFC located? Is there any branch in kannur

  • Jayaraj Gangadharan

    Sir I would like to know I can invest 5lakhs different date I mean I havy certain amount I need to 1lakh one year, 1 Lakhs 2 years and 3 Lakhs 3 yeary.
    Every year’s I need to 1lak on my accoun the interest will be holding there.
    Is this possible?

    • Yes. It is very much possible.

      Pls see the reviews from readers (in comments section) where there is mixed reaction about the process to apply this FD scheme. Since the entire process is offline, investors are finding difficulty in either opening the FD or for closing the FD. In this today’s digital world, every one would expect online transactions which is lacking here.


    Dear, I am a retired senior citizen, after seeing the FD scheme of KTDFC, I want to invest in this scheme, though it is sponsored by govt. of Kerala, still there is some fear, because out of Kerala there is no any office/ branch of this organization, kindly write the procedure of deposit.

    • Hello Harsh, Yes I could see the practical experience of our readers who are mailing me that the process is NOT online and it is tedious. Once invested, getting hold of KTDFC officials for either withdrawal or getting money at maturity is painful process.

  • Madan Mohan Ghosh

    How one can know the time when the prescribed limit has been fulfilled? Whether one can invest FD from different states?

  • bhaesh


    • Bhaesh, I responded similar query on another thread, repeating here. “Ideally speaking KTDFC which his owned by Kerala Government should not accept FDs beyond this prescribed limit by Govt. But as an investor we might not in case by mistake they are accepting such FDs beyond this limit which is beyond our control. Hence it is the only aspect which remains un-answered, otherwise, the FDs are guaranteed by Kerala Government. If you are interested in investing such FDs, one should put that question to the email ID / Contact nos given and get the clarity before investing.

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