Bank FDs are offering low interest rates. While company FD schemes offer high interest rates, these are riskier. Investing in a good credit rating company FD scheme can reduce the risk. Shriram Transport Finance FDโs offer upto 8.25% interest rates and 9.73% Yield and extra rates for Sr. Citizens. These FDs have good credit rating of ICRA AA and Ind AA stable. Should you invest in Shriram Transport Finance Fixed Deposit Scheme in 2022? What are the risk factors for investing in such fixed deposits? In this article we would do Shriram Transport Finance FD review and provide complete details.
Also Read: 5 High Return Mutual Funds to invest in 2022
About Shriram Transport Finance Limited
Shriram Transport Finance is a leading NBFC company in India that offers commercial vehicle loan, deposits, working capital loan, life insurance and business loans. Company was awarded “Best NBFC” under “Asset Back Lending” from CNBC TV18 in 2021.
Shriram Transport Finance FD โ Features and details
Shriram Transport Finance FD rates are between 6.54% to 8.25%. Yield is between 6.75% to 9.73%. Senior Citizens would get 0.5% higher interest rates and yield would cross 10%.
This fixed deposit scheme comes with 2 options – cumulative and non cumulative option.
Under non cumulative deposit scheme, interest is paid either monthly, quarterly, half yearly or yearly depending on the frequency chosen.
Under cumulative deposit scheme, interest would be paid on maturity along with principal.
Cumulative deposits provide compounding benefit and yield up to 9.73%.
FDโs are offered for 12 months to 60 months tenure.
Minimum deposit is Rs 5,000 and in multiples of Rs 1,000 there-on.
Interest would be directly credited to investors bank account or cheque/DD warrants can also be issued.
Shriram Transport Finance FD Rates in 2022
Here are the interest rates for cumulative and non cumulative schemes.
Senior Citizens would get 0.5% extra interest rate.
Existing customers can get 0.25% extra during renewal of FD.
Shriram group companies and their relatives would get 0.15% extra interest rates.
Why to invest in Shriram Transport Finance FD?
STFC is largest NBFC company in India.
These FDs offer attractive interest rates up to 8.25% and yield up to 9.73%.
Flexible deposit tenures would help investors to pick right FD.
Extra interest rates for Sr. Citizens, existing customers and employees of group companies and their relatives.
These FDs are rated as ICRA AA/Stable by ICRA Ratings and Ind AA/Stable by Ind Ratings. This indicates high degree of safety of these FDs.
Risk Factors in Shriram Transport Finance Fixed Deposits
These fixed deposits are un-secured. Means if company gets into financial crisis and gets closed / shut down / wind-up, FD investors would be given normal preference like any other creditor in the repayment of interest and principal amount of FD.
NBFC companies have turned riskier in the last few years. One should not forget about what happened to DHFL and delays what we are seeing in case of SREI investors.
The credit ratings given by ICRA and Ind Ratings can change without any advance intimation to investors.
FAQs on Shriram Transport FDs in 2022
Who is eligible to invest in these FDs?
Any Individuals, companies, Partnership Firms, Hindu Undivided Family (HUF), Trust and Foundations, Unincorporated Associations, or Body of Individuals can invest in this FD scheme.
Can I deposit cash and open a FD?
No. One can open FD scheme by transferring money from bank account or by issuing a cheque. You cannot open FD by depositing cash.
Is there any minimum amount to open these FDs?
Both for cumulative or non cumulative FD scheme, one need to invest minimum of Rs 5,000 and in multiples of Rs 1,000 there-off.
What is Shriram Transport Finance FD Calculator?
Shriram Transport finance FD calculator would help you to know how much interest you would get based on investment amount, specific tenure and option chosen. Here is the link for calculator.
What are Shriram Transport Finance FD rates for senior citizens?
Senior Citizens would get 0.5% extra interest rates compared to regular citizens.
When can I get interest in non cumulative deposit scheme?
Under non cumulative deposit scheme option, interest would be paid on the last day of the month / quarter / half year / year (based on the frequency chosen). As an example if monthly option is chosen, interest would be paid on the last day of the month. Similarly if quarterly option is chosen, interest would be paid on the last day of the quarter.
Can I withdraw FD before maturity?
Investors can withdraw the FD after 3 months. Here are the T&C on paremature withdrawals of the FD.
Less than 3 months โ Cannot withdraw
3 to 6 months โ No interest would be paid
> 6 months โ Interest would be paid 2% lower than regular interest.
How can I open FD in Shriram Transport Finance?
Yes, you can visit Stfc.in (Shriram Transport Finance website) and click on โFixed Depositโ to open the FD online.
For offline method, visit the nearest branch of the bank/NBFC.
Donโt visit other websites to open FDs online. You may get scammed.
Is there any TDS on interest received from these fixed deposits?
The interest earned from corporate FDs are taxable based on your income tax slab. However, company would deduct 10% TDS on such interest income if the interest income exceeds Rs 5,000 in a financial year.
Is FD safe in Shriram Transport Finance?
Shriram Transport finance FDs are rated as ICRA AA/Stable by ICRA Ratings and Ind AA /Stable by Ind Ratings and Research. However, such rating can change any time. Considering such high ratings, these FDs are safe.
Also Read: Aggressive Hybrid Mutual Funds for 2022
Should you invest in Shriram Transport Finance FD 2022?
Shriram Transport Finance offers attractive interest rates in 2022. The interest rates are between 6.54% to 8.25% and yield up to 9.73%.ย There are special interest rates for Sr. Citizens and employees. These company FDs have good credit rating of ICRA AA (Stable) by ICRA ratings and Ind AA/Stable by India Ratings and Research.
On other hand, corporate fixed deposits are unsecured. Means if company gets into financial crisis and gets shutdown, FD investors would be given normal preference in repayment of capital and interest. See what happened to DHFL investors, SREI investors etc.,
Investors who are willing to consider above risk factors can invest in this FD scheme.
Shriram Transport Finance FD form
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Thanks for your analysis and indepth views- which is valuable as usual. But , I wish to state for your esteemed clients, however GOOD it may sound and whatever may be the rate of interest for FDs by Shriram Transport Finance – it is simply a worthless proposition as far as any follow-up and (probably) safety is concerned. You will NEVER BE ABLE TO SEND ANY EMAIL TO THEM ON ANY ISSUES / QUERIES/PROBLEMS as it will always be returned as ‘address not found and non-deliverable’. I ham not saying this from heresay, I have a FD with them and and have never been able to send an email on critical issues to them (till date I have tried 18 times latest being 2 days back!) and stopped trying. There customer-care telephones are equally unreliable, irresponsible and bogus. First of they will never pickup, if after n-no. of trials you are lucky the person (mostly ladies) at their will end wisll say “Sorry, I am from vehicle insurance/ loan or something like that and the joke is they will not be able to give you the alternative no. for FDs! If you have the time to waste and visit their agent’s office (they call it STF office) many timees to get a hearing (the situation is just like customer care – only difference is face to face) and still remain unsatisfied then ONLY go ahead and subscribe to SRC FDs. If you are a Senior Citizen – simply don’t ever bother- you will be harassed to an unimaginable extent. I have FDs in other Corporates – who are not only responsible but have a well running/monitored system. What will you do with 2-3% extra interest p.a. if service is so hopeless that you are always in limbo. Just ignore . STF is not meant for FDs that too if you are investing your hard e4arned money and you have neither time to waste nor be able to resolve your problems with them online. Don’t say nobody told you!
Thanks for your valuable comments.
Though unsecured, AA rating by ICRA is a soothing point. Additionally, senior citizens can earn 0.50% higher thus making 8.45% on monthly payment basis which is reasonably good.
Though, with inflation in India hovering at 7%, and, above 7 to 8% in major developed economies of the world and liquidity surplus in the economy almost drying up, RBI is expected to increase its interest rate in its next review, paving the way for further hardening of interest rate.