HDFC has launched ‘green and sustainable deposits’, a unique fixed deposit scheme in India. The funds received from these fixed deposits would be used to finance sustainable housing credit solutions and services. These fixed deposits offer up to 6.55% interest rates. What are the Key Features of HDFC Green and Sustainable Fixed Deposits? Should you invest in HDFC Green and Sustainable Deposits (FD)?
Overview about HDFC Green and Sustainable Deposits
Housing Development Finance Corporation Limited (HDFC) has launched Green and Sustainable Deposit scheme. The aim of floating such fixed deposits is to safeguard the environment from climate change. The funds sourced through this scheme would be used for financing of green and sustainable housing credit solutions and services. HDFC says they are committed to support India’s effort for a sustainable and green low-carbon economy.
Key Features of HDFC Green and Sustainable Deposits
Here are the key features of this fixed deposit scheme.
1) Any Indian and NRI’s can invest in these fixed deposits. There are separate interest rates applicable for each category.
2) HDFC Green and Sustainable Deposits interest rates are between 5.65% to 6.55% for Indian residents and 5.65% to 5.95% for NRIs.
3) Separate interest rates for FDs up to Rs 2 Crores and above Rs 2 Crores.
4) These deposits are available for 33 months to 120 months tenure.
5) HDFC’s fixed deposits are rated as AAA by both CRISIL and ICRA which indicates highest safety. HDFC FDs are rated with such high credit rating for the past 27 consecutive years.
6) Investors can open these FDs online with a click of button.
7) Senior Citizens would get 0.25% higher interest rates up to Rs 2 Crores FD.
8) Additional return of 0.1% would be paid if investors renew these FDs online.
What are the interest rates on HDFC Green and Sustainable Deposits?
Here are the interest rates on these FDs. These interest rate effective from 17th August, 2021. Click image to enlarge.
Why to invest in these FDs?
Here are some of the key factors to invest such FD Schemes.
1) HDFC Green and Sustainable Fixed Deposits offer high interest rates up to 6.55%. Currently large banks are offering up to 5.5% which are low.
2) HDFC FDs have consistent credit rating of AAA from credit rating agencies. Its current rating is AAA from Crisil and Care.
3) While investors can get high interest rates through these FDs, they can directly contribute to sustainable and low carbon economy by investing in these fixed deposits.
4) Investors can open this FD online. They can renew or close these FDs by logging into HDFC portal. This provides ease of convenience for FD investors.
5) It offers loan against FD where investors need not break their FD for any short-term money requirements.
6) It offers interest either monthly, quarterly, half yearly, yearly or on maturity. Investors would have a variety of choice and can opt based on their requirement.
7) Senior Citizens can opt for monthly income plan or quarterly income plan which can help them to get regular income.
Why NOT to invest in HDFC Green and Sustainable Deposits?
Here are some of the negative factors in this FD scheme.
1) HDFC is a company and not a bank. While the FD’s are rated as AAA by Crisil and Care Ratings, there is no guarantee that such ratings would remain as-is. Credit rating agencies can always down grade a company credit rating without any advance intimation. One should look at what happened DHFL FDs which had high credit ratings earlier.
2) HDFC Green and Sustainable FD interest rates are still lower compared to small finance banks. Small finance bank FD’s offer up to 7.5% interest rates which are high compared to HDFC Fixed Deposits.
3) While HDFC fixed deposits have high credit ratings, in future, in case of any financial crisis, there is no guarantee for investors fixed deposits. In case of banks, there is deposit insurance to the tune of Rs 5 Lakhs. There is no such guarantee on HDFC fixed deposits.
4) HDFC offers loan against this FD. However, the interest rates would be high.
5) In case FD investor want to do pre-mature withdrawal after 6 months, they would get 1% lower interest rates.
Is it safe to invest in HDFC Green and Sustainable Deposits (FDs)?
HDFC offer high interest rates on these Green & Sustainable Fixed Deposits. It has good credit ratings of AAA from Crisil and Care Ratings. While the credit ratings can be downgraded in future, considering the consistency in the credit ratings for the past 27 consecutive years, these can be considered as safe investments in India.
How to invest in HDFC Green and Sustainable Fixed Deposits?
You can visit HDFC Green FD Online link enter PAN and date of birth, generate OTP and proceed with next steps about entering basic info and depositing money.
Should you invest in HDFC Green and Sustainable Deposits?
HDFC Green and Sustainable Deposits offer up to 6.55% interest rates on these FDs. It offers 33 months to 120 months tenure fixed deposits. It has good credit rating of AAA from Crisil and Care Ratings. While investors can get high interest rates, they would also be able to directly contribute to India’s effort in green and sustainable low carbon economy. Since these are corporate fixed deposits, there is some element of risk (risk of downgrading of the fixed deposits). Moderate to high-risk investors can invest in such fixed deposit schemes and enjoy high interest rates.
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