What is a Non-Callable Fixed Deposit?

Posted on Friday, November 22nd, 2024 | By IndusInd Bank

Do you want to invest in a fixed deposit but are worried about withdrawing it before maturity? A non-callable fixed deposit may be the correct option for you. But what exactly is it, and why must you consider it? 

In simple words, a non-callable deposit is a kind of fixed deposit where the investor is not permitted to withdraw the funds before the maturity period. This restriction offers specific benefits that can make it an enticing option for those looking for predictable, secure, and long-term returns. 

Here are four major points to understand the importance of a non-callable term deposit: 

1) Higher Interest Rates

A non-callable fixed deposit is tailored to offer higher returns because the financial institution has the certainty that the funds will stay untouched throughout the tenure. This permits the bank to plan its financials more effectively, resulting in better rates for the investor. 

When you select a non-callable deposit, you lock in a higher interest rate than what is offered on regular fixed deposits. This means your money grows at a faster pace, enhancing your returns over time. The absence of early withdrawals makes this kind of deposit especially enticing for those looking to earn more from their investments without the need for liquidity. 

2) Stable Returns 

Stability is one of the fundamental reasons investors consider a non-callable term deposit. As the funds are locked in for the whole term, the interest rate stays fixed, ensuring your returns are consistent and predictable. There are zero surprises with a non-callable deposit; you know exactly how much you will get at maturity. 

This makes it a prudent choice for conservative investors who prioritise security and assured returns over high-risk, high-reward investments. By using an online fixed deposit calculator, you can estimate your returns and plan your finances well, further enhancing the stability of your investment. 

3) No Premature Withdrawal  

The key feature of a non-callable fixed deposit is the inability to withdraw funds before maturity. This is especially crucial for high-value deposits, as premature withdrawal is strictly not permitted for amounts higher than ₹1 crore. Another type of FD that has such a restriction is the tax-saver FD that comes with a five-year lock-in period. This restriction ensures your investment stays intact, earning interest component throughout the term without any interruptions. 

While this may appear like a limitation, it works in favour of those who are committed to long-term growth. By keeping the funds locked in, the deposit continues to earn interest, leading to higher overall returns. It is a disciplined approach that is in line with long-term goals. 

4) Ideal for Long-Term Goals  

If you are planning for long-term financial objectives, such as your child’s education, retirement, or buying a home, a non-callable fixed deposit can be a prudent option. The commitment to keep the funds invested for the whole term aligns well with long-term financial goals, where liquidity is not a fundamental concern. 

By securing your funds in a non-callable deposit, you ensure that your investment stays focused on growth without the temptation to withdraw early. The predictable and fixed returns, clubbed with the higher rates, make it an excellent choice for long-term financial planning. It is a strategy that helps you remain on track with your goals, knowing that your investment is steadily growing and safe. 

Importance of Availing FD Through IndusInd Bank

Considering a non-callable term deposit, like a five-year tax-saving FD, through IndusInd Bank comes with a wide range of benefits that make it a preferred option for investors.  

Here’s a detailed look at the benefits – 

Also Read: 7 Reasons to Invest in Fixed Deposits 

Ending Note  

A non-callable fixed deposit account is a prudent option for those who prioritise higher returns and stable growth over liquidity. IndusInd Bank offers a wide range of benefits for investors looking to secure their funds in a non-callable term deposit, such as a tax-saving FD, including competitive rates, stress-free booking, and flexible interest payment options. 

Before making your decision, use an online fixed deposit calculator to understand the potential returns and how they align with your goals. For the best returns and safety, consider opening a non-callable fixed deposit with IndusInd Bank today and watch your investments grow securely. Start now! 

Disclaimer: The information provided in this article is generic in nature and for informational purposes only. It is not a substitute for specific advice in your own circumstances. Hence, you are advised to consult your financial advisor before making any financial decision. IndusInd Bank Limited (IBL) does not influence the views of the author in any way. IBL and the author shall not be responsible for any direct/indirect loss or liability incurred by the reader for taking any financial decisions based on the contents and information.