Flexi Fixed Deposit - Benefits and Features of Flexible FD

Fixed Deposits have been one of the most popular savings instruments in India since a long time. People prefer investing in Fixed Deposits (FDs) because FDs are one of the safest investment schemes that also provide satisfactory returns. Over the years, the banking landscape in India has evolved tremendously and many new products and investment options have been introduced. One such product is the Flexi Fixed Deposit, which combines the features of a Fixed Deposit and a Savings Account. Let us know more about its benefits.

Benefits and Features of Flexi Fixed Deposits

A Flexi FD provides the ideal combination of the security of a Fixed Deposit and the liquidity of a Savings Account. It enables automated transfers between the FD and its linked Savings Account, which results in increased returns while retaining access to funds. This facilitates cash flow management, making Flexi FDs an appropriate solution for individuals who need flexibility in their savings.

1. Higher Rate of Interest

Flexi Deposit interest rates are higher than the Savings Account interest rate. As a result, you can earn better returns on your funds. For example, if a Savings Account gives you interest at a rate of 2.5% per annum and a Flexi FD provides a higher interest rate of 6.85% per annum, you earn more on your idle funds while still having the flexibility to withdraw them when needed.

2. Flexibility to Choose Your Own Investment Amount

Flexi Fixed Deposit requires you to invest a lump sum amount; however, you have the liberty to choose any amount you want to invest. Different banks have different deposit criteria, make sure to check with the bank before opening your Fixed Deposit.

3. Flexibility in Investment Duration

You can choose your investment tenure to suit your needs. This means that you can stay invested for as long as you want, to suit your financial goals.

4. Easy Withdrawal

Most banks in India that allow you to invest in Flexi Fixed Deposits allow premature withdrawal of your investment as well. The flexibility of early withdrawal given by Flexi Fixed Deposits allows you to liquidate the investment in the event of any emergency.

5. Simple Process

The process of opening a Flexi Fixed Deposit is easy. Most banks in India have a very transparent process; you have to fill a form and provide basic details like the amount you want to invest, the duration for which you want to invest and the contact details including address and mobile number.

6. Loan Against Deposit

You can avail a loan/credit against the Deposit. It is advisable that you check with the bank about their policies for loans against Flexi Fixed Deposit as it varies from bank to bank.

7. Auto Renewal

If you have multiple investments, it can get difficult to remember the maturity dates and sometimes you might miss renewing your investment. With the Flexi Fixed Deposit,ﾠyou can avoid the hassle of remembering to renew your FD, since most banks offer auto-renewal facility to customers. You need not remember the maturity date as the bank will automatically renew the Deposit on maturity.

Invest in Flexi Fixed Deposits from ICICI Bank

ICICI Bank offers a Flexi FD called Money Multiplier FD. You benefit from the higher FD interest rate and the flexibility of choosing the amount you wish to deposit. The Money Multiplier FD is linked to your ICICI Bank Saving Account and is suitable for those who want to combine liquidity with high-interest earnings. 

Difference between Flexi Fixed Deposits and Regular Fixed Deposits

Regular FDs are not liquid, i.e. they incur penalties for early withdrawals. On the other hand, Flexi FDs provide more liquidity, allowing for automatic partial withdrawals when the Savings Account balance dips below a threshold level. They have the same interest rates as regular FDs and are always on auto-renewal mode.

Here is an overview of the major differences between Fixed and Regular FDs:

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